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CU System Archive

CU System

CU System briefs (11/12/2010)

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* GASTONIA, N.C. (11/15/10)--A man has been sentenced to life in prison for scaring to death an elderly woman whose home he hid in after a robbery attempt of a credit union. Larry Whitfield, 22, of Charlotte, N.C. and a co-defendant tried to rob a credit union in Gastonia in September 2009, according to court records. Prosecutors said Whitfield hid in the home of 79-year-old Mary Parnell and made her sit in a chair before he left the house. An autopsy showed she died of a heart attack that police say was prompted by the robbery suspect's presence. Whitfield was sentenced Wednesday in a federal court. He had been convicted of attempted bank robbery, various weapons charges and trying to avoid arrest for attempted bank robbery (Associated Press Newswires Nov. 11) … * MADISON, Wis.(11/15/10)--Michael Kerr, a staffer at Eagle Legacy CU, Arvada, Colo., won a $5,000 grant for his credit union at CUNA Mutual Group's first Online Discovery Conference on Nov. 3. He won the grant by earning points for participating in conference activities, including webinars, chat rooms, exhibit hall booths, message boards and a networking lounge. Kerr plans to donate the $5,000 to the Eagle Legacy Foundation, the credit union's scholarship program. Conference webinars and materials will be available online until Feb. 4. The Discovery Conference will be back in its face-to-face format next summer through CUNA Mutual's collaboration with the Credit Union National Association and its America's Credit Union Conference …

Three separate CU mergers completed

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MADISON, Wis. (11/15/10)--Three pairs of credit unions have announced separate mergers in California, Pennsylvania and Illinois. Dixie Cup Employees FCU, which served employees of the Dixie Consumer Products plant in Forks Township, Pa., merged into First Commonwealth FCU, Bethlehem, Pa., as of Nov. 1. Dixie Cup members voted to approve the merger at a special meeting Oct. 13. Dixie Cup has assets of 1.2 million and First Commonwealth had assets of $484 million (Life is a Highway Nov. 10). Palo Alto (Calif.) Community FCU, a $12 million credit union with 1,500 members, has merged into San Mateo CU, a $592.8 million asset credit union with about 72,300 members. The state Department of Financial Institutions announced the merger on Nov. 5. Palo Alto had posted a net loss of $66,000 for the year ending Sept. 30, an improvement over its $322,000 loss a year earlier (San Jose Business Journal Nov. 11). lst Northwest FCU, Freeport, Ill., merged Nov. 1 into First Northern CU, a $288.2 million asset credit union based in Chicago. First Northern CU will have a grand opening Thursday at its new Freeport branch. It also has branches in Chicago, Evanston and Rockford (Rockford Register Star (Nov. 12).

Corporates new CUSO to transition CU payment systems

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KANSAS CITY, Mo. (11/15/10)--The corporate network said Friday it will create a credit union service organization (CUSO) to provide a path for the transition of the critical credit union payment systems. According to the Association of Corporate Credit Unions (ACCU), the new network solution will capitalize on various core services used by more than 7,200 credit unions. The services include products such as automated clearinghouse (ACH), national settlement (or automated settlement), international services, and custody/safekeeping, as well as services offered through subsidiaries of U.S. Central FCU. The concept will help ensure an orderly transition of existing contracts and distribution networks of each participating corporate into a new CUSO model, ACCU said. The CUSO will be jointly owned by corporates and other potential credit union system participants, and would work to maintain scale and greater efficiencies. The objective would be to minimize any impact or interruption to payment system services and delivery. Corporates are in agreement that the payment systems developed and operated by U.S. Central--systems both supported and distributed by the corporates--are an invaluable resource for the credit union network, ACCU said. "Consensus is that these systems are critical to keep intact, as they represent significant scale and offer a great example of industry collaboration," ACCU said in a press release. For more information, contact Larry Harmon, ACCU executive director, at lharmon@qversal.com. In other actions, the National Credit Union Administration Friday announced the formal creation of bridge corporate credit unions to assume the operations of Members United Corporate of Warrenville, Ill., and Southwest Corporate of Plano, Texas.

State court halts CUs 1 purchase of 24 acres

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NORTH LIBERTY, Iowa (11/15/10)--A Johnson County, Iowa, District Court judge Wednesday issued a temporary injunction to keep the city of North Liberty and a development group from buying land for a new University of Iowa Community CU headquarters. A group of individuals Tuesday requested the judge temporarily halt the plan to purchase the land, saying the city's incentive plan could result in higher taxes to pay off the city's bond on the property (Iowa City Press-Citizen Nov. 11). Last month, the city approved the purchase of 64 acres near Interstate 380 from owners North Liberty CC at a cost of $11 million for the economic development project (Iowa City Press-Citizen Nov. 10). Of the acquired land, 24 acres were to be transferred for $1 to the credit union by 380 Development Group. The credit union planned to build a 100,000-square-foot facility to house 400 employees. According to the Iowa City Area Development Group, the project would generate 400 direct jobs 230 indirect jobs and 324 induced jobs (kcrg.com Nov. 10). By law, cities cannot sell or give away property for less than the assessed value, so the 380 Development Group was formed to support the transaction. The city would sell bonds to facilitate the land purchase and the credit union property would be designated as a TIF (tax increment financing) area with the taxes raised going to repay the bonds. The lawsuit said rezoning the land from multi-family to office and research park is illegal. A hearing has been set for Jan. 4 on the injunction.

Wis. payday loan rules could affect short-term loans

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MILWAUKEE (11/15/10)--Wisconsin credit unions are exempt from the state's new rules for payday lenders, and the Wisconsin Credit Union League will monitor the development of the rules, while some lenders say the rules could impact short-term loans by banks, credit unions and other lenders. An article on Milwaukee Magazine's website said lenders were criticizing the new rules against predatory lending, saying that the rules "could also restrict the ability of banks, credit unions and other lenders to make small, short-term loans" (milwaukeenewsbuzz.com Nov. 12). The Wisconsin Financial Services Association, which represents the state's consumer finance industry, including sub-prime lenders, questioned the rules being drafted by the state Department of Financial Institutions (DFI) to carry out legislation passed earlier this year. However, the league told News Now that credit unions are exempt. "The new payday loan statute is plain on its face and not-for-profit credit unions are expressly exempted from these regulations," said Tom Liebe, vice president of government affairs at the league. "As the vast majority of Wisconsin credit unions already make small dollar loans to members in need, we will continue to monitor the rule development and take any action necessary to ensure credit unions can continue to meet those needs," he in an e-mail. Under the rules, no loan under $1,500 could have a term shorter than 90 days or an "open-end" credit plan where interest accumulates until the loan is paid off, said the article. The rules limit the number of customer checks a payday lender can hold for a loan to five. One rule requires payday loans to have uniform payments, while another prohibits payday lenders from entering into "open-end" credit plans with consumers. The law also caps the amount anyone in the state can borrow from a payday lender, including interest, at $1,500 and requires the DFI to set up an online database for lenders to check how many outstanding payday loans a customer has.

U.S. Central papers key in Corporate America lawsuit v. NCUA

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BIRMINGHAM, Ala. (11/15/10)--More than 750,000 pages of documents related to the decision-making process at the U.S. Central FCU before it was placed into conservatorship by the National Credit Union Administration (NCUA) are at the heart of a suit filed last week by the Alabama-based Corporate America CU against NCUA. Corporate America filed the complaint in a U.S. District Court for the Northern District of Alabama in Birmingham on Nov. 10. It seeks documents that it hopes would shed light on the decisions made regarding member credit unions' paid-in capital by U.S. Central's volunteer board of directors and officials in 2008, as the nation's credit crisis heated up. Wednesday's complaint said Corporate America originally subpoenaed documents from U.S. Central on May 5 as part of its lawsuit against U.S. Central's former directors and officers. It sued the officials because U.S. Central was liquidated. However, the corporate was told by U.S. Central that its documents were in the possession of NCUA as its conservator and that the corporate would need to make the request under the Freedom of Information Act, the complaint said. The corporate narrowed its scope of documents requested on June 25 and issued a written request for documents, but on July 19 it received "a response from NCUA refusing to produce certain categories of requested documents" and saying that NCUA wanted a prior agreement from the corporate that the production of such documents would satisfy the agency's obligations. The corporate modified its request and has waited for a response and the documents for more than four months, the complaint said. The suit also claims NCUA produced more than 750,000 pages of documents and made others available for inspection and copying to counsel for the directors and officers named as defendants in the original litigation. The corporate is seeking an order to produce the documents and costs and expenses of the litigation. NCUA told News Now it cannot comment on pending litigation.

Texas league develops advocate training series

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FARMERS BRANCH, Texas (11/15/10)--The Texas Credit Union League (TCUL) has developed a “Navigator Series” of training sessions to help credit union legislative coordinators become stronger advocates in preparation for the 2011 legislative session. A TCUL release said the Navigator Series prepares legislative coordinators for a higher level of political involvement by combining information about the “nuts and bolts” of the political process with best practices for engaging members and employees in grassroots advocacy. Topics covered by the three-part series include:
* Navigating the Capitol by finding a route to important sites and understanding how bills are passed; * Navigating the relationship to effectively communicate the credit union’s role and concerns, handle meetings and learn best practices for employee and member involvement; and * Navigating the issues by reviewing key issues and players in the 2011 legislative session.
The first session was held early this month, while the second session will occur in December and the third will be in January. In the future, the first two portions of the Navigator Series will be aimed at new legislative coordinators, while the “navigating the issues” segment will be offered to all coordinators to prepare them for upcoming legislative sessions, the league said.

Oregon CUs share results of young adult outreach

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PORTLAND, Ore. (11/15/10)--Oregon credit unions are reaching out to young adults with iPads, a “second look” at loans that were initially denied and community partnerships that reach underserved markets. Those award-winning ideas were among the resourceful approaches to young adult outreach shared by 11 credit unions at a recent REAL Solutions workshop sponsored by the Credit Union Association of Oregon (CUAO). The majority of the Oregon credit unions participating in REAL Solutions began working on fresh approaches to reaching the young adult market in May 2010. Brent Dixon from the Filene Research Institute, Madison, Wis., used a series of webinars and workshops to coach credit union participants about the tools and mindset needed to reach young members. Three credit unions were recognized for innovative approaches that included:
* The iPad implementation project of Unitus Community CU, Portland, recognized as “best idea.” Two business development managers at Unitus use iPads to open accounts, make loans and sell services in the community. Since launching the iPad project, Unitus went from a monthly average of 67 new member accounts with a 3.33 cross-sell ratio to 102 new accounts with a 3.88 cross-sell ratio in August 2010. * The “second look” for loans that were initially denied for the target age group of 18 to 30 at Pacific Crest FCU, Klamath Falls, which was voted “most resourceful.” As a result of this culture shift in loan reviews, loans for this age group increased from 340 to 606 and balances increased from $2.7 million to $7.2 million. * The Mapping Your Future project at MaPs CU, Salem, which received a “wild card” award. The project uses community partnerships to bring financial services to underserved markets, particularly its Hispanic community. Five community partners and 10 financial educators will reach 100 Latino families to increase their financial capabilities.
Other outreach program participants were Point West CU, Portland; Northwest Resource FCU, Portland; Northwest Community CU, Springfield; Valley Health & Postal Employees CU, Salem; Wauna CU, Clatskanie; Rivermark CU, Beaverton; Rogue FCU, Medford; and Oregon Community CU, Eugene. REAL Solutions is a National Credit Union Foundation program that helps credit unions develop products and services to meet the needs of low wealth households.

Pennsylvania foundation board elects officers

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HARRISBURG, Pa. (11/15/10)--The Pennsylvania Credit Union Foundation board recently elected Chris Woods, CEO of Keystone FCU, West Chester, to serve as secretary (Life is a Highway Nov. 12). The board also re-elected two officers: Vice Chairman Dave Ackerman, CEO of USX FCU, Cranberry Township, and Treasurer Jeff DeBree, CEO of Penn East FCU, Scranton.
Enterprise Car Sales representatives (from left) Lisa Regalski, Tiffany Walenchok, Laura Heintzelman and Kaushika Kansara presented a $7,500 donation to Pennsylvania Credit Union Foundation Executive Director Joe Wambach and Board Chair Diana Roberts. (Photo provided by the Pennsylvania Credit Union Association).
Enterprise Car Sales representatives opened the meeting by presenting a donation of $7,500. In other business:
* Board member Mary Beth Wilcher, CEO of Erie FCU, presented an update on the credit union’s financial education website (www.TeachMeAboutMoney.org), which now includes six new videos. * Tricia Heisey, community development o fficer, Belco Community CU, reported on the progress of the credit union’s community financial education. * The foundation approved its budget for 2011 with a 2% increase in revenue, and will include a development educator scholarship.

NEW Corporates creating CUSO to transition CU payment systems

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KANSAS CITY, Mo. (FILED 1:30 p.m. CT 11/15/10)--The corporate network will create a credit union service organization (CUSO) to provide a path for the transition of the critical credit union payment systems, according to the Association of Corporate Credit Unions (ACCU). The new network solution will capitalize on various core services used by more than 7,200 credit unions. The services include products such as automated clearinghouse (ACH), national settlement (or automated settlement), international services, and custody/safekeeping, as well as services offered through subsidiaries of U.S. Central FCU. The concept will help ensure an orderly transition of existing contracts and distribution networks of each participating corporate into a new CUSO model, ACCU said. The CUSO will be jointly owned by corporates and other potential credit union system participants, and would work to maintain scale and greater efficiencies. The objective would be to minimize any impact or interruption to payment system services and delivery. Corporates are in agreement that the payment systems developed and operated by U.S. Central--systems both supported and distributed by the corporates--are an invaluable resource for the credit union network, ACCU said. "Consensus is that these systems are critical to keep intact, as they represent significant scale and offer a great example of industry collaboration," ACCU said in a press release. For more information, contact Larry Harmon, ACCU executive director, at lharmon@qversal.com. In other actions, the National Credit Union Administration today announced the creation of two new bridge corporate credit unions to assume the operations of Members United Corporate of Warrenville, Ill., and Southwest Corporate of Plano. Texas. More detail will be in Monday's News Now.