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CUs to support National Runaway Prevention Month

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CHICAGO and SAN DIMAS, Calif. (10/26/09)--Financial Service Centers Cooperative Inc. (FSCC), and National Runaway Switchboard (NRS) are partnering again to raise awareness with credit unions nationwide to support National Runaway Prevention Month this November. FSCC is encouraging more credit unions to support the campaign, which aims to raise awareness of issues facing runaway and at-risk youth, and educate Americans about solutions and the role they can play in preventing youth from running way. “The youth of today is our future,” said Sarah Canepa Bang, FSCC president/CEO. “As community leaders and more importantly, as parents, we need to find ways to help prevent youth runaway. The ‘Answering the Call’ campaign serves as a great way to spread the word on youth runaway and gain more awareness and support through credit unions and their members. “This is an awareness campaign that can be supported by simply putting up a flyer at the credit union,” she added. “The credit union movement has a long history of helping children and youth. We hope more credit unions will open their hearts to this worthy cause.” NRS receives an overwhelming amount of requests for help with calls coming in from across the country, said Maureen Blaha, NRS executive director. “While NRS handles more than 100,000 calls a year, youth issues can be very complex,” Blaha said. “We find that family dynamics is the most frequent problem identified by crisis callers. Youth run away from home for many reasons but our job is to help keep them safe and off the streets.” FSCC and NRS urge credit unions to participate in the campaign by using the promotional materials that highlight the campaign. Materials can be used inside credit union branches and lobbies to show support. A community action kit is also available, which includes activities that can be used to help raise awareness and provide solutions that prevent youth from running away. These materials can be downloaded on the NRS website at www.1800RUNAWAY.org and by visiting www.fscc.com or www.cuswirl.com, and clicking on the NRS logo. Family dynamics (divorce, remarriage, problems with siblings) and abuse (substance, physical, sexual, neglect) are the top reasons youth reach out for help, according to NRS call-volume statistics. Research shows that between 1.6 and 2.8 million youth run away per year, and according to NRS’ 2008 call statistics, more than half (51%) of the youth crisis callers were already on the street as a runaway or throwaway, and more than half (56%) said they had been away from home between one and seven days before calling NRS.

Ohio CUs growing during economic downturn

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COLUMBUS, Ohio (10/26/09)--The national economic downturn has allowed Ohio’s 402 credit unions to grow their memberships and make more auto and home loans, according to the Ohio Credit Union league. Credit unions in the state benefited because they continued to make loans when many banks cut back on their lending, the league said (The Columbus Dispatch Oct. 23). “Over the past 18 months, due to the economic stress, a lot of banks have had to build up liquidity and reposition their balance sheet, and this has forced them to curtail lending,” Dave Fearing, league vice president of business services, told the newspaper. “And that provided the perfect opportunity for credit unions to add that needed liquidity to the market.” Credit union membership statewide rose about 30,000 in the first half of 2009 to nearly 2.7 million members, the league added. So far this year, the market share of auto loans for Ohio’s credit unions is 18.4%--up from 12.4% in 2008 and 10.1% in 2007, the league told the paper. Mortgage originations for the first half of this year were $960.5 million--which is 50.2% higher than the 2008 total of $639.5 million. Also, market share is 3.5%--up from 2% at the end of 2007, the league added. “This is the first growth we’ve seen in five years,” Patrick Harris, league director of media relations, told the paper. To view the article, use the link.

Community CUs of the year announced

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LAS VEGAS (10/26/09)--The 2009 Community Credit Union of the Year awards were announced Thursday at the Credit Union National Association’s (CUNA) Community Credit Union and Growth Conference in Las Vegas. The Community Credit Union awards recognize and honor community credit unions that best exemplify the principles of the credit union movement while serving as a positive influence in the field of service. New for 2009, CUNA added a secondary level of recognition as part of the Community Credit Union of the Year Awards--the Award of Merit. The award recognizes the outstanding work being done by credit unions across the country. Award winners in the $250-million-and-below asset category were:
* Archer (Neb.) Cooperative CU, which received the Community Credit Union of the Year Award. Shelly Broekemeier, vice president of operations, accepted the award. * US Community CU, Nashville, which received the Award of Merit. Credit union CEO Cheryl Thompson; Paul Johnson, executive vice president; and Cindy Bubin, senior vice president, accepted the award.
Winners in the $250-million-and-above asset category were:
* Elevations CU, Boulder, Colo., which received the Community Credit Union of the Year award for the same category. Dennis Paul, associate vice president of business and community development, accepted the award. * Shell FCU, Deer Park, Texas, which received the Award of Merit. Angela Head, vice president of information systems, accepted the award.
For more information, use the links.

CU System brief (10/23/2009)

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* HARRISBURG, Pa. (10/26/09)--Pennsylvania State Rep. Peter Daley (D-Fayette) presented the state House of Representatives with a resolution recognizing Oct. 11-17 as Credit Union Week in Pennsylvania. The resolution recognizes credit unions for helping members improve their economic situations and the volunteers who support credit unions and charitable events, said the Pennsylvania Credit Union Association (Life is a Highway Oct. 22). Christina Mihalik, association vice president of governmental affairs, accepted the resolution from Daley (left). Daley is chairman of the state House Commerce Committee. (Photo provided by the Pennsylvania Credit Union Association) ...

Mich. county wants to deposit money in CUs

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MOUNT CLEMENS, Mich. (10/26/09)--A Michigan county has asked its commission’s finance committee for a resolution so the county can deposit money at credit unions, according to a Michigan newspaper. Oakland County, which has an annual budget of $700 million, deposits money into banks through certificates and checking accounts. State law doesn’t prohibit counties from depositing money at credit unions--but doesn’t specifically allow it (Daily Tribune Oct. 23). County Treasurer Andy Meisner told the newspaper that there aren’t a lot of “safe options” available for investments. The move isn’t a “knock on banks,” but the county wishes to “take advantage of any safe opportunity out there,” he told the newspaper. The county’s investment policy is to promote safety, and depositing money in credit unions will allow it to fulfill that, Meisner added. If the county’s finance committee supports the resolution to allow deposits at credit unions, the measure will then move to the full 25-member commission for approval. Meisner said he expects bipartisan support for the measure, he told the paper.

Federation joins Obama to support small biz lending

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LANDOVER, Md. (10/26/09)--The National Federation of Community Development Credit Unions joined President Barack Obama and other elected officials last week to announce their support for small-business lending. “We will make capital even more affordable to the community development financial institutions that focus on providing credit to America's small businesses in our hardest hit rural and underserved communities,” said President Barack Obama at the roll-out of a series of Obama administration initiatives to spur small-business lending. The president’s address was delivered in the warehouse of Metropolitan Archives, a building that this small business (the archives) purchased with the help of a loan from the Small Business Administration (SBA). Dan Mica, president/CEO of the Credit Union National Association (CUNA), also attended the event and followed up Thursday with a letter to President Obama about credit union member business lending. CUNA believes the administration and Congress should support a legislative fix to the member business loan cap as an important step to ensure credit is available to small businesses, which will promote economic recovery, Mica emphasized. The president was joined by Treasury Secretary Tim Geithner, SBA administrator Karen Mills, Maryland Gov. Martin O'Malley; U.S. House of Representatives Majority Leader Steny Hoyer; and other elected officials. Mica and Cliff Rosenthal, federation president/CEO, were among about 60 invited guests at the announcement. Among credit union movement attendees was Bill Bynum, president/ CEO of Hope Community CU/Enterprise Corporation of the Delta (Jackson, Miss) and chairman of the Community Development Financial Institutions (CDFI) Advisory Board of the U.S. Treasury Department. “We believe that many more credit unions will seek certification now, and we are delighted that the CDFI Fund has committed itself to an expedited review process,” Rosenthal said. Community development financial institutions include credit unions, banks, loan funds, and venture capital funds that are certified by the Treasury Department’s CDFI Fund in recognition of their mission and track record of serving low-income and underserved communities. Since its founding in 1994, the CDFI Fund has invested nearly $1 billion in CDFIs. The federation, itself a certified CDFI, has been a leader of the CDFI movement since the early 1990s. While details of the program will be forthcoming at a later date, some key features were announced. For credit unions, CDFI certification will be required. About 150 credit unions are certified CDFIs. The majority of those are federation members. The government’s investment in CDFI credit unions will be in the form of subordinated debt that will count as secondary capital, or regulatory net worth, for low-income credit unions. “We are pleased that the Treasury Department has adopted this structure, and that the proposed rate is 2% for the first eight years,” Rosenthal said. He said that credit unions must have both CDFI certification and low-income designation by the National Credit Union Association (NCUA) to participate. “Only low-income-designated credit unions currently have the power to accept secondary capital, Rosenthal added. “Conversely, low-income designation without CDFI certification will not make a credit union eligible. It's clear that CDFI certification will be a key credential for credit unions in the future, and the federation will continue to provide technical assistance to members seeking certification.” The Obama administration has provided momentum and support to the CDFI movement, more than doubling its appropriation request for the CDFI Fund and providing an additional $100 million in American Recovery and Reinvestment Act "stimulus" funding in the spring of 2009, the federation said. With such bright prospects, the federation said it is adamant in its resolve to expand credit union participation in the high-impact program. For more information, use the link.

WOCCU helps grow Kenyan cooperatives

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TALA, Kenya (10/26/09)--The World Council of Credit Unions’ (WOCCU) SACCO Growth Program in Kenya is helping the country’s credit unions and businesses thrive.
Click to view larger image Kenyan farmer Patrick Mutua cultivates 900 coffee trees. He also is a member of Universal Traders SACCO, which participates in the World Council of Credit Unions’ SACCO Growth Program.
Patrick Mutua is one individual the program is helping. With 900 coffee trees to tend, Mutua is considered by his neighbors to be a successful farmer and busy man. He also serves as vice chairman of the Kyaume Farmers' Cooperative, one of Kenya’s coffee cooperatives, whose members band together for bulk purchasing and crop sales to negotiate the best prices for each. Mutua and his fellow co-op members also are members of Universal Traders SACCO (UTS), a credit union whose five branches now serve more than 18,000 members, including 1,500 coffee farmers and eight growers’ cooperatives like the one to which Mutua belongs. UTS is one of four credit unions that has grown in size as a member of WOCCU’s growth program, funded by the Bill & Melinda Gates Foundation. Although only two years old, UTS scored a coup when the Kenyan government recognized its value to members and partnered with the SACCO to administer the agricultural loan funds it provides to coffee growers nationwide. The plants are in the early stages of the growing season, with harvest nearly six months off, meaning the coffee farmers will be seeking to tap the 10 million Kenyan shillings (about $133,000) in government loan funds that UTS will distribute to farmers who are SACCO members, according to Jacob Wambua, manager of the UTS branch in Tala. “We don't pay them in cash,” Wambua said. “We post it to their credit union account. To qualify for the government funds, they must be actively cultivating at least 100 coffee trees. And they have to be members in good standing.”
Click to view larger image Universal Traders SACCO Chairman Isaiah Mutungi (left) and Jacob Wambua, branch manager, support Kenya’s coffee farmers by administering government-funded loans. (Photos provided by the World Council of Credit Unions)
The government loan program aims to strengthen and grow Kenya's coffee export program, which has languished in recent years due to social and economic issues. Funds are loaned to qualifying farmers at a 10% interest rate. Of that, UTS is able to keep 5% of the interest earned on the loans to fund its operations, Wambua said. Participation in the government program is a step forward for UTS itself, whose membership had dwindled until two years ago when it became part of the WOCCU program. WOCCU provided technical assistance and branding support while fostering an aggressive marketing campaign that took credit union representatives into the massive twice-weekly public markets in Tala, which has a population of about 100,000, to solicit members. The efforts helped the credit union grow from 1,600 members to its current level in about 18 months, according to Isaiah Mutungi, pastor of the Africa Inland Church and chairman of the UTS board. The relationship with WOCCU has been a steep educational process in order for UTS to reach its current success levels, said Mutungi, who also farms his own crop of 800 coffee trees. It has also awakened in credit union staff and board members the notion that the SACCO members themselves can benefit from some much needed financial education, which has become an active part of their service program. “In the olden days, people did not know banking,” Mutungi said. “You can even give small babies coins and they learn how to spend, but not how to save. This is what we are teaching them.” Financial education is central to the program that supports the coffee farmers who live near Tala and the SACCO's four other branches. Understanding savings and learning how to manage money are especially critical this time of year, when the coffee trees are in their initial budding stages and far from providing any income to their growers. The support and strengthening WOCCU has been providing UTS over the past few years has enabled the SACCO, in turn, to provide similar services for its members, Mutungi said. “Our partnership with WOCCU has added great value to the SACCO and gives us a better foundation for a more strategic approach,” Mutungi added. “We believe we are ahead of other SACCOs in Kenya, but we are still learning. And we would like to pass that understanding on to our members as well.”