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CU System Archive

CU System

Landmark CU, Badger Campus CU to merge

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NEW BERLIN, Wis. (1/29/13)--Badger Campus CU is merging into New Berlin, Wis.-based Landmark CU, giving Landmark a presence in the Madison, Wis., market.

The merger was approved by the boards of both credit unions, but still must be voted on by Badger Campus CU members.

The merger adds a branch location in Madison and widens $2.1 billion Landmark's charter to include Dane and Iowa counties.

The target date for the merger is March 31, with the integration of Badger Campus' member accounts into Landmark's computer system this summer.

With the union, Landmark will have 31 branches.

CU System briefs (01/29/2013)

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  • PITTSBURGH (1/29/13)--The former manager of the now defunct Lawrence County School Employee FCU, New Castle, Pa., has been sentenced to 15 months in prison and ordered to repay nearly $223,000 embezzled from the credit union.  Holly Cowan of Slippery Rock Township, who pleaded guilty to embezzlement and tax evasion, also was sentenced to three years of supervised release and orderd to pay the full amount in restitution and pay the Internal Revenue Service $63,000. The theft occurred over five years. An assistant manager, Stacy L. Attisano, also of Slippery Rock, pleaded guilty to embezzlement and tax evasion and will be sentenced April 19. The women were accused of taking $811,000 by falsifying deposits and loan payments. The credit union had $2.6 million in assets and 1,805 members at the time it was liquidated by the National Credit Union Administration on March 5, 2010 (Beaver County Times Jan. 24) …
  • MOUNTAIN VIEW, Calif. (1/29/13)--First Tech FCU reported it "is well-positioned to increase member value in 2013." Its total assets rose 9.3% to $5.6 billion in 2012, while total loans rose 15.6% to $3.3 billion over loans for the period ending Dec. 31, 2011. First Tech also reported a net income of $62.8 million--a 1.15% return on assets representing a 51% increase over earnings for the period ending Dec. 31, 2011. As of year-end 2012, First Tech remains the nation's 12th largest credit union, serving 360,000 members throughout the U.S.  Its reserves total $537.2 million and results in a PCA Capital Ratio of 9.57%. First Tech will reinvest its 2012 earnings into the credit union so it can "continue delivering competitively-priced share and loan products for our members while also making significant technology and process investments that will allow us to better meet the needs of our members and their families," said Gregory Mitchell, president/CEO …
  • ALBUQUERQUE, N.M. (1/29/13)--U.S. New Mexico FCU has named Marsha Majors as president/CEO. She succeeds James Raquet, who retired this month after serving more than 10 years in the position. Majors has 27 years of credit union experience, beginning her career as a retirement account administrator and progressing to her most recent position as executive vice president. The $740 million asset credit union is based in Albuquerque and serves more than 70,000 members. It has four six branches--four in Albuquerque with a fifth to open in second quarter, plus one in Bernalillo and one in Farmington. A fifth branch will open second quarter in Albuquerque …

NWCUA column: Taxing Oregon CUs would cost consumers tens of millions

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BEAVERTON, Ore. (1/29/13)--Taxing Oregon's credit unions would yield little in state revenue but would cost Oregonians tens of millions of dollars annually in direct financial benefits, says an op-ed column by the Northwest Credit Union Association.

The article, written by NWCUA President/CEO Troy Stang and published in The Oregonian (Jan. 25), is a response to a bank commentary about credit unions' tax status that suggested restructuring credit unions like banks. NWCUA and credit unions oppose three bank-supported bills introduced in the Oregon legislature that would end credit unions' tax status and initiate Community Reinvestment Act-like requirements for credit unions.

Preserving credit unions' tax-exemption is the top priority of the Credit Union National Association and will be the No. 1 issue at CUNA's Governmental Affairs Conference Feb. 24-28 in Washington, D.C.  (See today's News Now story, Cheney advocates for CU tax status on Hill.")

"The credit union model, regardless of a credit union's size, is as relevant and critical to consumer choice as ever before," said Stang in the article.

"As a not-for-profit institution, owned by members, the cooperative model of shared benefits stands in stark contrast to the stockholder-focused banks and the constant drive to increase profits through higher fees and loan rates," Stang wrote.

Banks criticize credit unions "for consolidating into larger institutions in order to provide better products and services to consumers" and omit the fact that credit unions pay property and payroll taxes and members pay income taxes on the earnings they receive, he said. "Without a not-for-profit alternative for consumers, there would be little incentive for banks to restrain their ever-increasing drive to grow income through escalating fees. This would impose direct harm on consumers and businesses during a time of economic difficulty," Stang wrote.

The Federal Credit Union Act was signed into law in 1934 "to make credit available through nonprofit, cooperative credit unions," said Stang. "Indeed, during the most recent recession, credit unions were increasing their support of local businesses when banks were not willing or able to, demonstrating why the role of the not-for-profit credit union is as critical today as ever before. It is no wonder that Congress and every president, Republican or Democrat, since that time has reaffirmed the right of citizens to form their own financial cooperative."

Credit union membership and assets have grown, he said, and "to Oregon credit unions, that is the litmus test of quality of service" to their 1.4 million members. "It seems Oregonians are speaking with their feet," he concluded

For the full article, use the link.

Filene: Benchmarking about sustainability, not bottom line

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MADISON, Wis. (1/29/13)--Credit unions must approach benchmarking differently than for-profit  institutions and focus on sustainability rather than the bottom line, according to a new Filene Research Institute report.   

The endgame for credit unions is sustainability--generating profits so that the institutions can continue to provide benefits to members and jobs for employees, Filene said in "Improving Peer Group Analysis for Credit Unions."

The credit union system dynamic suggests six core areas to focus on benchmarking activities and asking themselves some tough questions:

1. Asset growth: Where is the asset growth coming from (e.g., loans versus investments) and how does our growth compare to our peers?

2. Product mix: How does a credit union's product mix compare to its peers, especially with respect to capital-efficient products that provide noninterest income?

3. Interest rates: Who has the best rates and why? (The report suggests focusing on forward-looking offer rates rather than backward-looking portfolio rates.)

4. Operating expenses: Who has the best efficiency ratio and why? Does the efficiency ratio tell a credit union everything it needs to know? (The report says no and suggests an alternative measure.)

5. Credit losses: How does a credit union's delinquencies and net charge-offs compare to its peers? Internally, a credit union might ask itself how it is trending (up, down, or flat) on key measures such as the weighted-average credit score of loans outstanding or household income as a percentage of loans outstanding.

6. Capital adequacy: How does the institution's total and risk-weighted capital compare to its peers?

Filene suggests two ways to frame the benchmarking process: member value-assessment and venerable SWOT (strengths, weaknesses, opportunities and threats) analysis. 

Member-value assessment looks at the benchmarking process through the prism of providing maximum member benefits. Given the sustainability mandate, it focuses on how a credit union, relative to its peers, is managing the trade-off between--for instance--providing a large patronage payment and the consequences of that for sustainability. 

The SWOT analysis approach compares a credit union's performance with that of peers in each of the six core areas. SWOT then labels each sub-area as a member benefit, improvement opportunity, or a boost to return on assets.

The benchmarking process does have some pitfalls. If credit unions choose the wrong peers, they could learn the wrong lessons. Credit unions of similar size could have different strategic visions, commitments to branch networks or membership bases.   

Other pitfalls are: Measuring too many factors; failing to properly understand the context of their peers' successes and failures; relying only on annualized data that mask misleading one-off gains or losses; or failing to ask enough "why" questions.

Friday is ticket deadline for Wegner Awards dinner

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MADISON, Wis. (1/29/13)--Credit union leaders and supporters looking to attend the National Credit Union Foundation Dinner Presenting the Herb Wegner Memorial Awards have a Feb. 1 deadline to purchase tickets via mail or fax and a Feb. 15 deadline to purchase tickets online.

The 25th annual dinner will take place on Feb. 25 in conjunction with the Credit Union National Association Governmental Affairs Conference in Washington, D.C.

Registrants can obtain tickets online or choose to download the form and fax or mail their completed form to NCUF. Use the links. Individual tickets for the three-course dinner are $275 each. Tables of 10 are $2,750.  

The awards ceremony will celebrate the highest national honors in the credit union movement:

  • Lifetime Achievement: Rick Craig, retired president/CEO, America First FCU, Riverdale Utah;
  • Individual Achievement: Hubert H. Hoosman Jr, president/CEO of Vantage CU, Bridgeton, Mo.; and
  • Outstanding Program: Credit Union Miracle Day.
For more information, contact Josie Collins at jcollins@ncuf.coop or 800-356-9655, ext. 4397.

Pa state treasurer joins fin literacy town hall meeting

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HARRISBURG, Pa. (1/29/13)--State Treasurer Rob McCord will join the Pennsylvania Credit Union Association and Pennsylvania Credit Union Foundation on a panel about financial management basics, to be aired on the Pennsylvania Cable Network (PCN).

The financial literacy town hall meeting will address banking, credit, investments and budgets, and how to establish credit, said PCUA (Life is a Highway Jan.28).

Also on the panel will be Michael Kaczenski, PCUA chairman and CEO of Sun East FCU, Aston; Michael Wishnow, PCUA senior vice president of communications and public relations; and Matt Bergman, teacher at the Milton Hershey School.

PCN, the association and the foundation have partnered to present a series of quarterly town meetings concerning literacy.  They are open to the public.

The first in the series, "Financial Management 101," will take place Monday at 4 p.m. ET. PCN will air the educational session statewide later beginning at 9 p.m. Monday. It will re-run throughout next week.

Retailers' new checkout fees create a ruckus in media

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MADISON, Wis. (1/29/13)--Retailers' new "checkout fees" on credit card use took effect Sunday, and the date did not go unnoticed by dozens of the nation's top mass media or by consumers using social media to express their displeasure.

News Now counted 27 stories across the country about the ability of retailers in 40 states to charge the fees under the terms of a $7.2 billion settlement reached between credit card companies and merchants in July.  Most media reported that retailers can impose between 1.5% and 4% of the cost of the purchase and add it to the credit card bill.

The Credit Union National Association is monitoring the impact of the surcharge. (See today's News Now story, CUNA watches for credit card surcharge impact.)

Among the more prominent media were: The Wall Street Journal, FOX & Friends, ABC News, NBC News, Fox News, CBS, CNN Money, Chicago Tribune, New York Daily News, The Daily Republic, and The Motley Fool. Media in major cities such as New York; Washington D.C.;  Atlanta; Boston;  Cleveland; Seattle; and Atlanta also published or aired reports. Media in West Virginia, Kentucky, North Carolina, Nebraska, Alabama, Kentucky, and Illinois carried stories on Sunday and Monday.

Most stories warned consumers that if they used a credit card, they should check for the fee. Some said to shop at businesses that don't charge the fees.

An advocacy group, Consumer Action, is widely quoted warning shoppers to be on the lookout for the fees. "Our advice is to tell them you don't like the fee and this makes you want to take your business elsewhere," said Ruth Susswein, deputy director of national priorities for the group (NBCnews.com Jan. 27).

Gerri Detweiler, director of consumer education at Credit.com, told ABC News she expects the number of merchants introducing the fee will be small at first. They likely will be smaller merchants or service providers such as accountants and massage therapists. She too advised consumers to tell the merchant if they object to the charge.

Consumers already were expressing anger about the fees on the news outlets' Facebook pages and story comment sections. Some called the fees "outrageous" and one suggested that consumers "boycott all the stores that want to charge" a fee.

Some merchants also were distancing themselves from the fees.  NBC reported that Home Depot, Sears, Target and Wal-Mart said they have no plans to introduce a credit card surcharge. Several smaller companies used social media to reassure consumers they are not introducing the fees.

The surcharge is supposed to equal the actual cost of processing the credit card transaction and can vary, based on the type of card used. Ten states have outlawed the surcharges: California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas.

Fin ed opportunity: Show members how to improve credit scores

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MADISON, Wis. (1/29/13)--Many U.S. consumers want to improve their credit scores, but don't know how, according to a new survey. That's where credit unions can help. Some credit unions are making the most of this opportunity to educate their members.

Most respondents--83%--in a freecreditscore.com survey have checked their credit scores; however, nearly half (42%) want to improve credit scores but don't know how.

Other survey findings provide insights into credit awareness and credit usage. Sixty-five percent of respondents indicated that they consider their credit score when engaging in credit-related activities such as maxing out a card, applying for a new card or skipping a payment. Women (68%) are more likely than men (61%) to consider their credit score before making credit usage decisions.

How are credit unions helping? Some offer workshops. Cessna Employees CU, Wichita, Kan., is offering a free Credit Enhancement seminar tonight. After the seminar, credit union loan officers will provide one-on-one counseling to help members assess their individual credit reports.

University of Virginia CU will educate members with an Understanding Credit and Credit Scores seminar on April 9. The credit union presents the seminar regularly, Glenn Birch, Virginia CU's public and media relations director, told News Now.

"Members are not always clear on how their scores are compiled," said Birch. "We point out the all the factors they should be aware of."

A consumer's credit score based on five factors, according to Fair Isaac Corp., the company that compiles credit scores. The factors include:

  • Payment history (35% of score);
  • Amounts owed (30%)
  • Length of credit history (15%);
  • New credit (10%); and
  • Types of credit (10%).
Richmond, Va.-based Virginia CU also partners with Balance, a financial assistance counseling service that can help members improve their credit scores, and offers credit score information on its web site.

UW CU, Madison, Wis., offers My Credit Score, for members with access to their credit scores through its online banking platform. My Credit Score allows members to track changes in their credit scores and view a customized in-depth analysis of their credit picture.

UW CU offers My Credit Score through Credit Karma, a provider of consumer credit score services.

Verity members cartwheel for a cause in video contest

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SEATTLE (1/29/13)--A credit union is asking state of Washington residents to submit a short video that features a cartwheel, or anything representing a cartwheel, for the chance to win a $1,000 prize and a $5,000 donation to the cause of their choice. Verity CU in Seattle launched its second "Cartwheel for a Cause" contest earlier this month.

"We see this as a great opportunity to let the community get involved and tell us which causes they feel we should donate to," Melina Young, Verity's director of marketing, told the Northwest Credit Union Association. "This was a great way to brand Verity in the community without having to spend a ton of money, and it helps to teach the community about our values" (Anthem Recap Jan. 25).

"Cartwheel for a Cause spun out of our Cartwheel Checking account," Young told News Now. "For that checking account--and really across the board--our target market is moms. People appreciate the visuals that come out of cartwheels and that makes them smile. Focus groups a few years ago helped us see that and come up with name for that rewards checking program. Also, Cartwheel Checking ties in with Verity Mom."

The $385 million asset Verity previously used contest marketing to build and maintain member engagement in its Verity Mom campaign, Young told NWCUA.

The credit union launched Verity Mom in 2009 because moms and families were not being well-served by large faceless financial institutions. Moms in Washington didn't have a voice in getting what they needed financially. So Verity launched a search for a Mom and gave her platform: the Verity Mom website.

For the cartwheel contest, each video must describe the cause that person believes deserves a $5,000 donation. All causes must be a designated 501(c) (3) nonprofit organization. Also, the video must include a cartwheel somewhere.

"The creative cartwheels are one of the best parts of this contest," Young said. To see the videos, use the link.

The contest also promotes Verity's brand and visibility, gives members a voice in the credit union's community involvement, and draws attention to organizations and areas of need that might not otherwise have access to such a public forum, NWCUA said.

"In the first year, we had someone bring a $150,000 home equity line of credit to us because her sister was on the board of one of the charities that was nominated and she thought our values represented us as a place she would like to put her money," Young told the association. "Stories like that help justify the money spent to market a campaign like this."

Two runners-up will earn $1,000 donations to the causes highlighted in their videos, along with a $200 individual prize.

Cooperative Trust names GAC Crashers

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MADISON, Wis. (1/29/13)--The Filene Research Institute's Cooperative Trust has selected 19 young credit union leaders to "crash" the Credit Union National Association's Governmental Affairs Conference, Feb. 24-28 in Washington, D.C.

The "crashers" will also attend a pre-conference design thinking workshop led by Brent Dixon, founder of Crash the GAC and The Cooperative Trust. The new workshop will focus on how to innovate around small-business lending. Design thinking is a process that uses human-centered research, pattern recognition and rapid prototyping to solve problems.

As part of the workshop, crashers will interview young Washington, D.C., area entrepreneurs about their needs.

The 2013 Crash the GAC celebrates its fourth year. CUNA's Center for Professional Development again has provided full scholarships for Crashers to attend.

Crash the GAC is a project of The Cooperative Trust is a training and development community for young credit union professionals. It began as a Filene project and is supported by multiple industry partners. CUNA Mutual Group serves as the Trust's title sponsor and PSCU, St. Petersburg, Fla., also provides support.

The 2013 Crashers are:

  • Danielle Frawley, vice president, marketing and communications, Fort Community CU, Fort Atkinson, Wis.;
  • Jennifer Tebbe, eServices branch manager, Greater Iowa CU, Ames, Iowa;
  • Chris Friederich, senior analyst, CUNA Mutual Group, Madison, Wis.;
  • Brittany Hilton, marketing specialist, Mid-Atlantic FCU, Germantown, Md.;
  • Justin Mouzoukos, assistant vice president, finance, Mazuma CU, Kansas City, Mo.;
  • Amanda Brenneman, business development officer, Maps CU, Salem, Ore.;
  • Chad Holz, manager, product portfolio strategy, University FCU, Austin, Texas;
  • Ashley Dietz, marketing coordinator, City County CU, Fort Lauderdale, Fla.;
  • Joshua Smith, advocacy officer, SchoolsFirst FCU, Santa Ana, Calif.;
  • Blake Woods, public relations and new media manager, Lake Trust CU, Lansing, Mich.;
  • Mitchell Michiels, financial architect, Best Advantage CU, Brillion, Wis.;
  • Erin Ballard, communications coordinator, AmeriCU, Rome, N.Y.;
  • Sean Flynn, assistance vice president, consumer lending, GTE Financial, Tampa, Fla.;
  • Elizabeth Weger, marketing specialist, Pathways Financial CU, Columbus, Ohio;
  • Lindsay Estok, branch manager, Seasons FCU, Middletontown, Conn.;
  • Olivia Rockers, marketing specialist, Iowa CU League, Des Moines, Iowa;
  • Ashley Pierce, accounting assistant, A+ FCU, Austin, Texas;
  • Meghan Storck, business development specialist, First Florida CU, Jacksonville, Fla.; and
  • James Marshall, marketing manager, Plane Saver CU, London, U.K.
Speaker of the House Rep. John Boehner (R-Ohio), credit union champions Sen. Mark Udall (D-Colo.), Rep. Ed Royce (R-Calif.) and Rep. Brad Sherman (D-Calif.) are among the speakers scheduled for the  2013 GAC.

House Financial Services Committee Chairman Jeb Hensarling (R-Texas), House Majority Whip Kevin McCarthy (R-Calif.), House Financial Services Committee senior member Spencer Bachus (R-Ala.), House Financial Services Committee member Rep. Gregory Meeks (D-N.Y.), Sen. Elizabeth Warren (D-Mass.), Rep. Peter King (R-N.Y.), Rep. Blaine Luetkemeyer (R-Mo.) are also on the GAC speaking schedule.