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Leagues efforts in media outreach succeeding

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MADISON, Wis. (10/3/08)--Leagues across the nation are reporting success in their efforts to educate the public and the media about credit unions safety, soundness and strength. Many of their media outreach activities have resulted in positive press for credit unions. The Credit Union Association of Oregon (CUAO) reported a "busy week for talking to the media about credit unions on both a national and local level, and we are only half-way through," said Laura Weiking, director of communications. "We are in a great position to be the 'good guys' and we are taking every opportunity to tout that credit unions are safe, sound and still lending," she said. "In each interview we are stressing that credit unions are insured, they are sound, they are lending and they are ready to talk to consumers about becoming a member," Weiking told News Now. CUAO President/CEO Troy Stang participated in a live show, "Think Out Loud," on Oregon Public Broadcasting and spoke with the Oregonian. Weiking and Pam Leavitt, CUAO vice president of government affairs and public relations, were interviewed for separate shows on KEX 1190 News Radio. CUAO also is running an ad, "There is a Credit Union for You," as part of its statewide awareness campaign the week prior to International Credit Union Day (Oct. 16). New Jersey Credit Union League President/CEO Paul Gentile was quoted in the state's largest paper, the Star-Leger about credit unions' ability to help consumers and businesses in the tough times because of their strength. The Wall Street Journal interviewed Gentile Wednesday, and the league recently published an op-ed touting credit unions in the Jersey Journal. Today he is in New York City to record a video message about the safety of New Jersey's credit unions that the league's member credit unions can put on their websites. The league's trainer is conducting a 25-minute webinar to train frontline staff on how to explain share insurance to members. "We have made emergency funds available to do ads on 101.5, New Jersey's largest radio station, touting credit union safety and our strength," Gentile said in an e-mail. "We are using the slogan: 'New Jersey's Credit Unions, Banking You Can Trust.'" Funds are also earmarked for ads in three major newspapers. Credit Union Associations of Colorado and Wyoming CEO John Dill was featured prominently in Rocky Mountain News Thursday in an article, "Bailout tough pill, Colo. leaders say." "The current conditions clearly call for drastic action, and the Senate approval is a first step toward unfreezing our credit markets," said Dill. He was the first Colorado leader quoted in the story. He told the publication that consumers' anger is justified. "Credit unions, like most Americans, are not the source of the problem that has led to the worst economic meltdown since the Great Depression," he said. "Despite the fact we're fully insured by the federal government and our efforts to help members, we still need action to address the psychology and the substance of the problem." Sylvia Lyon, president/CEO of the Credit Union Association of New Mexico (CUANM), was interviewed Thursday on Channel 13-KRQE, a local television news station. The segment focuses on how credit unions are performing in the current economy and the financial crisis, and emphasizes credit unions federal insurance coverage and the increase in coverage through the U.S. government's rescue plan. Lyon also explained why credit unions didn't get involved in subprime mortgages, and she discussed membership eligibility and how to locate a credit union. The Ohio Credit Union League has sent chapter presidents sample press releases and guest columns they can customize for their local media. It also is sending an ad stressing credit unions' safety and soundness and ability to offer loans during the credit crunch. The Massachusetts Credit Union League will publish quarter-page ads in major newspapers throughout the Commonwealth on Sunday. The ads reinforce the message that credit unions are safe, sound and secure (E-Weekly Oct. 1). The Delaware Credit Union League sent out a press release developed by the Credit Union National Association about the increase to the federal insurance coverage, which includes credit unions.

Forget banks join the CU is just one headline

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MADISON, Wis. (10/3/08)--Credit unions have got to love the headlines that have appeared about them the past week in both local and national media while the nation struggles with the financial crisis. Two of the latest examples: "Forget Banks, Join the Credit Union," from West Orlando News (Oct. 2), and "Credit unions are doing just fine," from Indiana TV station WFIE (Oct. 1). Credit unions "may be among the safest financial institutions in the nation, despite our nation's current economic struggles," says the West Orlando News article. It notes credit unions are gaining recognition among consumers and on Capitol Hill for avoiding the problems that created the financial mess, and for being part of the solution.
Greg Smith, president/CEO of Pennsylvania State Employees CU and Bill Hayes, former chairman of the Pennsylvania Bankers Association, discussed the impact of the financial crisis on Pennsylvania consumers on the Pennsylvania Cable Network (PCN) Wednesday (Life is a Highway Oct. 2). During the hour-long call-in show, Smith said credit unions are federally insured. He told how the National Credit Union Share Insurance Fund is equivalent to that of the FDIC. (Photo provided by the Pennsylvania Credit Union Association)
In the article, Florida Credit Union League President/CEO Guy M. Hood tells about credit unions' federal insurance with the National Credit Union Administration (NCUA) and notes that "when it comes to personal finances, credit unions are here to serve, to counsel and to protect their membership compassionately." Credit Union National Association (CUNA) Chief Economist Bill Hampel explains that credit unions are in very good shape and that delinquencies are up but low in comparison with other financial institutions. (Use link for complete article.) Credit unions are providing a safe haven to investors during the financial crisis, says the WFIE Indiana story. It features Kate Baumgartner of Evansville FCU, and Ruth Gaon of Heritage FCU, Newburg, who have seen depositors moving money from banks to their credit unions (14 News Oct. 1). In New York, Kirk Kordeleski, CEO, Bethpage (N.Y.) FCU, was interviewed Tuesday evening by NBC Channel 4 in Long Island about loans--specifically auto loans and mortgages. It's difficult to get loans because credit is being evaluated more carefully and there isn't as much liquidity, he told the news station. However, Bethpage FCU has liquidity and is able to lend to its members. Its loan portfolio has grown "substantially," Kordeleski told News Now. Bethpage's mortgage portfolio grew by $300 million compared with last year--a 12% increase, he said. The credit union has seen growth in fixed and adjustable-rate mortgages, and is one of the few lenders in Long Island that can offer well-priced loans. Homes in the area go from $350,000 to $800,000, he said. "In a scary and shaky time, there seems to be an opportunity for us," he said. "Credit unions across the country are seeing deposit growth and [an increase in] lending." In Pennsylvania, Fox 43 News at Ten featured a story about "Nation's Economic Problems hit Main Street in Mechanicsburg." Carol Fastrich, vice president of marketing at Americhoice FCU, reiterated the message that credit unions are safe, sound and secure. She told the station that accounts are insured by NCUA. WBRE TV, in Wilkes-Barre, Pa., last Friday told viewers that the financial crisis has credit unions busier and focused its story on people who deposit their money in smaller financial institutions. It featured Mark Filbert, CEO of NEPA Community FCU, Stroudsburg (Life is a Highway Oct. 2). (Use the link for the article.) In the Lebanon Daily News, a letter to the editor by Glenn Rambler, executive vice president of Lebanon (Pa.) FCU resulted in an article, "Local bankers say customers need not fear," which featured Rambler and Jim Starr, director of marketing and media of Pennsylvania Central FCU. They mentioned credit unions' federal insurance. (Use the link for the full article).

SACU creates new division with CU Factory Built Lending

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SAN ANTONIO (10/3/08)--Employees of CU Factory Built Lending L.P. (CUFBL) have joined San Antonio FCU (SACU) as a new division, SACU announced Wednesday. Since 2004, CU Factory Built Lending L.P. has been a SACU subsidiary, taking a leadership role in providing and servicing manufactured home loans for the credit union industry. Filling a void for consumers in a climate where site-built construction costs have skyrocketed, the organization helps thousands of members obtain loans to buy construction at an affordable price or refinance their existing homes to more favorable terms, said SACU. SACU President/CEO Jeff Farver said the change will allow CUFBL and the $2.6 billion asset credit union to serve current and prospective members. The division and SACU will continue providing manufactured housing lending.

CU merging with bank meets with members

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AUGUSTA, Maine (10/3/08)--Kennebec Valley (KV) FCU held town meetings this week to inform members about a proposal to merge with a local savings bank. The town meetings were Tuesday in Augusta, Maine, and Wednesday in Oakland, Maine, according to media reports. KV FCU is based in Augusta. KV FCU and Kennebec Bank announced in September that they were discussing the credit union converting to a federal mutual savings bank charter and then merging with the bank (News Now Sept. 10). The credit union said the proposed conversion and merger would expand its ability to meet the current and future needs of members (News Now Sept. 10). News Now was unable to reach KV FCU for comment by press time. KV FCU has $51 million in assets.

CU System briefs (10/02/2008)

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* HARRISBURG, Pa. (10/3/08)--Mid-Atlantic Corporate FCU President/CEO Jay Murray represented credit unions Thursday at a Pennsylvania House Commerce Committee meeting on how the economic and banking crisis and bailout rejection will impact Pennsylvanians (Life is a Highway Oct. 2). Murray explained the corporate provides liquidity to the state's credit unions and that credit unions are insured by the National Credit Union Administration (NCUA) to the same extent as banks. Credit unions have reached out to members in assuring them their deposits are insured, he said. In discussing the need to address issues on how to prevent the crisis from happening again, Murray said, "Right now, it is crucial that confidence is kept with consumers and we don't cause anymore disruption in the system." He reiterated he had confidence in credit unions and that consumers should feel safe to have their funds deposited in them. (Photo provided by the Pennsylvania Credit Union Association) … * MADISON, Wis. (10/3/08)--The University of Wisconsin CU (UW CU) has pledged $600,000 to needs-based scholarships across all the campuses it serves. An outright pledge of $300,000 will be gifted and the additional $300,000 is part of a member-match initiative. YW CU is offering to match donations to UW-Madison, UW-Milwaukee, UW-Green Bay, UW-Stevens Point, UW-Whitewater and Madison Area Technical College. Also, the University of Wisconsin Foundation will match any gifts to the UW-Madison fund, multiplying the donation by four. The initiative will run through the end of December. "Statistics show that from 2000 to 2005, tuition has increased nearly 28%," said UW CU President Paul Kundert. "We hope that our members and our community will see that together, we can provide the opportunity for anyone to succeed and graduate from one of the top universities in the world." …

ColoradoWyoming CUs launch Foolproof fin ed program

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DENVER (10/3/08)--The Credit Union Associations of Colorado and Wyoming reported that nearly one-half of the states’ 1.7 million credit union members now have online access to consumer education and information programs through FoolProof, a financial literacy initiative launched in April. “This is the fastest adoption rate of any program we’ve offered,” said John Dill, president/CEO. FoolProof uses interactive, online modules and websites to reach members and non-members. “Even the smallest credit union can have five separate financial literacy and consumer educator programs--separate programs for adults, high school students, and college-age students,” said Will deHoo, FoolProof president. FoolProof for High Schools provides high school teachers with two weeks of free, web-driven classroom instruction on financial literacy and management. FoolProof Solo teaches college students the credit union difference, and Information Edge is a real-time consumer newspaper with video, podcasts and breaking news stories. Credit unions receive a marketing materials to help introduce the program, including press releases, presentations, newsletter articles and Web content. The program’s cost is tiered to make it affordable for credit unions regardless of asset size.

Texas regulator urges caution in explaining CU difference

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FARMERS BRANCH, Texas (10/3/08)--A Texas regulator is urging credit unions in the state to use caution with the claims they make to explain any advantages credit unions may possess in maintaining the security of members’ accounts. The Texas Credit Union Department (TCUD) issued a regulatory bulletin regarding advertising campaigns geared to educating the public about safety and soundness of credit unions (LoneStar Leaguer Oct. 2). The bulletin reads: “It has come to our attention that some credit unions have engaged in very liberal advertising campaigns using such superlatives as ‘most secure,’ ‘strongest’ and ‘safest’ or that play on public fears about other types of financial institutions.” TCUD said it has received numerous complaints that these types of ads are disseminating information that usually is impossible to justify or quantify. “We believe this form of advertising is inappropriate and, in some cases, represents a violation of state and federal laws,” the bulletin continues. “These ads undermine the public standing of other insured financial institutions and increase the public’s concerns,” TCUD said. The regulatory bulletin references a state code that says in part that “an advertisement shall be deemed to be misleading if it states that the credit union’s services are superior to or of a higher quality than that of another financial institution, unless the credit union can factually substantiate the statement.” To view the regulatory bulletin, use the link. Visitors will have to log in to view the document.

IWSJI CUs captives best chance to get auto loans

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NEW YORK (10/3/08)--Credit unions and automakers’ captive-finance companies can offer consumers the best chances of receiving an auto loan, The Wall Street Journal said Thursday. Credit unions are in a better financial position than large banks, and will consider other factors outside of a FICO score when lending to members, the newspaper said. Economic troubles have halted credit, meaning that car loans and leases are harder to find because lenders don’t have the money to lend to buyers, it added. Auto lending is down about 64% of auto loan applications were approved as of Sept. 20, compared with 83% during the same period in 2007, according to CNW Marketing Research. Subprime application approvals were at 44%, compared with 67% a year ago. Car loan recipients are required to put more money down--up to 20% of a vehicle’s value. The average down payment on a car was $3,067, up from $2,435--the second time the amount has exceeded $3,000 in four years, the Journal said. To see a video about credit unions and auto loans, use the link.

Market events boost economic forum registrations

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PLANO, Texas (10/3/08)--Credit unions appear to be looking for strategic guidance due to financial market turmoil, according to Southwest Corporate FCU’s early registration figures for its 2008 Economic Forum. The forum has a 13% increase over last year. The theme for the forum Oct. 28-29 in Dallas is “Looking Beyond the Horizon.” Speakers will address political implications for the economy under a new U.S. president. Other topics include: emerging trends in technology, the impact of developing authentic member service relationships, effects of high energy costs, global economic factors, demographic patterns, observations from Wall Street and the latest credit union statistics. “The market events for the last few months are unprecedented,” said John Cassidy, Southwest Corporate president/CEO. “Credit unions want to know what they can do to increase their insulation from these events, and the boldest ones want to know if it’s possible to grow in this environment. “The Economic Forum and our two bonus seminars give credit unions the ability to draw from the perspectives of up to 20 different financial experts under one roof in less than three days,” he continued. Registration for the Financial Management Sequence, which occurs the day before the forum begins, has already surpassed last year’s attendance. Southwest Corporate also added a new seminar on member business services, for which registration is nearing capacity. The Financial Management Sequence will address what to expect in the markets and industry, the outlook for mortgage and consumer loans, investment and liquidity strategies, and core operating trends. The new Member Business Services Sequence will provide credit unions with an overview of options available and what to consider in launching and supporting a member business services program. Considerations include strategy development, automated clearing house and Treasury services, remote deposit, lending and marketing. For more information, use the link.

CU robbery suspect dies in getaway crash

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DES MOINES, Iowa (10/3/08)--A man suspected of robbing a Des Moines credit union died minutes after the robbery when a stolen car he drove crashed during a high-speed chase by police. Gregory Novel Doudy, 37, allegedly robbed employees of EdCo Community CU at gunpoint around 7 a.m. Wednesday, according to police (Des Moines Register Oct. 1). Two employees at the $27.9 million asset credit union arrived at work when a gunman followed them into the credit union and robbed them. No injuries were reported, police said. The gunman stole one employee’s car and crashed it west of Des Moines with police in pursuit. The suspect was killed in the crash, the Iowa State Patrol confirmed.

August CU loans up 1 savings up 3.2

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MADISON, Wis. (10/3/08)--Credit union lending remained strong in August and the overall credit union loan delinquency rate remained historically low, indicating the credit crisis is having a marginal effect on credit unions’ credit quality.
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Credit union loans outstanding increased 1% in August, and 5.4% over the first eight months of 2008, according to the Credit Union National Association (CUNA) monthly sample of credit unions. Other loans (2.6%) led growth, followed by adjustable rate mortgages (1.6%), home equity loans (1.4%), credit cards (1.2%), fixed-rate mortgages, and used-auto loans (1%). Fixed-rate mortgages had the largest rise since December, increasing 13.9%, while new-auto loans decreased 5.8% during the same period. “Credit union lending remained robust in the month of August as total loan balances outstanding rose 1.1% or 8.4% on a seasonally adjusted annual rate,” Steve Rick, CUNA senior economist, told News Now. “With other financial institutions tightening their loan underwriting standards, credit unions are picking up market share, especially in the real estate lending area. “Fixed-rate first mortgage balances increased 1.1% in August, slightly lower than adjustable-rate first mortgage balance increase of 1.6%,” he continued. “More and more credit unions are holding onto their mortgages rather than selling them into the secondary market. In the first half of 2008, only 24.5% of originated mortgages were sold into the secondary market, down from 27.6% in the first half of 2007,” he said.
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Credit union savings balances remained at $691 billion in August, but have risen 5.9% year-to-date. Share drafts led savings growth, rising 3.2% in August. Money market accounts (0.3%) and individual retirement accounts (0.2%) increased, while one-year certificates declined 1%. With loan growth outpacing savings growth, the loan-to-savings ratio increased to 83% from 82.1% in July. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--remained at 15.5% in August. Regarding asset quality, credit unions’ 60-plus-day delinquencies remained at 1% in August and for all of 2008 so far. “The credit crisis is having only a marginal effect on credit unions' credit quality,” Rick said. “The overall credit union loan delinquency rate barely climbed to over 1% in August, even though it is up from 0.73% during August 2007. The current delinquency rate is low by any historical measure and is quite manageable for credit unions.” The movement’s overall capital-to-asset ratio remains at 11%, with the total dollar amount of capital at $90 billion.