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NEW: HarborOne Members Vote To Convert To Bank

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BROCKTON, Mass. (3/18/13 Filed 11:10 p.m. ET)--Members of HarborOne CU in Brockton, Mass., have voted to convert the $1.9 billion asset credit union to a mutual cooperative bank charter.

Roughly 62% of voting members cast their ballots in favor of the change. Of its 139,078 members, more than 22,433 or 21% of eligible voters actually voted by mailing ballots or attending a special member meeting held March 11 (Fort Mills Times and The Enterprise (March 18).

The votes were confirmed by an independent auditing firm, the Colbent Corp. of Braintree, Mass. The ballots and materials used for the vote will now go to state banking officials and the National Credit Union National Administration.

The credit union is the largest state-chartered credit union in New England. The credit union had said when it applied for the change that it had to turn down mortgage lending business because its charter was limited to four counties, it was nearing its member business lending cap, and it could not grow in the Boston market.

NCUA had said the credit union could have petitioned the state to widen its geographic boundaries and that it was not near its MBL cap.

Both the Credit Union National Association and the Massachusetts Credit Union League  have said a credit union charter is the best option for credit union members and any decision should be in the best interest of the members.

Loyalty To Mobile Banking Kept Some From Switching To CUs

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PLANO, Texas (3/18/13)--Credit unions could have gained even more members than the 2.2 million members they added  in the weeks surrounding Bank Transfer Day, if they had made it easier for consumers to transfer their mobile accounts, according to  Jim Van Dyke , CEO of Javelin Strategy & Research.

Although the Nov. 5, 2011 event was a big gift to credit unions, not all credit unions were ready to turn unhappy customers into loyal members, he said.  Many people dissatisfied with their big bank's overwhelming fees and underwhelming customer service supported the idea of moving their accounts to a credit union, but disconnecting from their big bank's mobile banking product proved to be a deal-killer for some, said Van Dyke.

Van Dyke will be among the presenters at Catalyst Corporate FCU's Accelerating Success Conference, to be held April 9-10 in conjunction with Catalyst's Annual Meeting in San Diego.

Javelin conducts research on risks and opportunities in mobile initiatives, multichannel financial services, payments and security, risk, and fraud. As part of that research, Van Dyke traveled to Occupy movement protest sites in the fall of 2012 to research consumer attitudes associated with Bank Transfer Day and certain financial services, including mobile banking.

"I spoke with people who wanted to move their accounts from a bank to a credit union," he said. "But when I asked, 'Are you going to switch,' I heard, 'No. I do everything on my mobile.' If implemented correctly, a loyalty factor exists with mobile banking, much like the loyalty surrounding bill pay in the late 1990s," Van Dyke told Catalyst Corporate.

Mobile has emerged as the new critical access point for consumer accounts, he said. "It can move members from a secondary to a primary relationship with a financial institution. That's important, because secondary relationships have all of the same costs that are associated with a primary relationship, but without the profitability," he said.

How credit unions deploy mobile matters, Van Dyke said.  Credit unions should not feel pressured by vendors to buy the latest, greatest technology. Nor should they sit back on their heels to wait for a better time to evaluate participation in the mobile arena, he added.

Certain features--such as the ability to check balances--are important to all mobile programs, but they have to be blended with strategy unique to an individual financial institution. To be successful, Van Dyke said, strategy should be built on answers to questions such as:

  • Who are you trying to serve (field of membership)?
  • What are your age concentrations?
  • Is your membership high-tech or low-tech?
  • What is the service distribution channel mix?
  • Who are you competing with?
  • What makes your institution different?
  • Where are you in the mobile life cycle?
  • Does your purchase align with branch strategy? For example, would mobile deposit make sense given the location of your members and the number of branches you have?
"Avoid the extremes of trying to do everything and doing nothing," he said. "You must be in mobile, but you can pick your battles."  He recommended two "smart bets" for lower cost, higher return strategies:

  • Provide text message alerts for low balances or payment due dates,  and
  • Plug into apps--Android for the younger members and iPhone for the older. Put Windows and Blackberry platforms farther down the list, he added.
Van Dyke will share additional insights from Javelin studies on mobile banking in his April 9 conference presentation, "How Mobile Banking Can Increase Return on Investment." Catalyst Corporate will have information on its mobile services at the conference product expo.  Early bird registration ends Tuesday. For more information, use the link.

CU System Briefs (03/18/2013)

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  • WASHINGTON (3/18/13)--Credit Union National Association President/CEO Bill Cheney (right) talks with former Federal Deposit Insurance Corp. chairman Sheila Bair and Stephen Brobeck, executive director of the Consumer Federation of America (CFA).  Bair was a keynote speaker at CFA's annual meeting in Washington Thursday. The former regulator urged higher capital levels for the nation's largest banks as a way to avoid future failures and a halt to lending should another deep recession occur. She praised the mission of the Consumer Financial Protection Bureau and said Congress should confirm its director, Richard Cordray, but Bair also said regulators need to be mindful of the growing burden that complex and costly regulations pose for smaller banks and credit unions. (Photo provided by CUNA) …
  • APPLETON, Wis. (3/18/13)--Community First CU, a $1.7 billion asset credit union in Appleton,Wis., has installed automated external defibrillators (AED) at all its branches in the Fox Valley and northeast Wisconsin (The Post-Crescent March 15). Mark Evers, maintenance specialist at the credit union and a volunteer firefighter and first responder with the Greenville Fire Department, suggested the credit union install the AEDs. "All you have to do is listen to it and do what it says. It gives that individual a lot better chance of survival," he told the publication. Evers has used an AED in his vehicle six times to revive cardiac victims. Although the credit union has trained first responders at all locations, now every employee has the ability to help in an emergency, said spokesperson Amanda Secord …
  • FARMERS BRANCH, Texas (3/18/13)--The Alamo Chapter of Credit Unions (ACCU) in Texas was back on Capitol Hill, just one week after Hill visits during the Credit Union National Association's Governmental Affairs Conference in Washington, says the Texas Credit Union League (LoneStar Leaguer March 15). This time the group is participating in SA to DC, an annual conference hosted by the Greater San Antonio Chamber of Commerce, the San Antonio Hispanic Chamber of Commerce and the Free Trade Alliance. The chapter served as a sponsor for speakers Sen. Ted Cruz (R-Texas) and U.S. Rep. Henry Cuellar (D-Texas). ACCU Board President Ashley Harris introduced the speakers. Harris is pictured here with Rep. Pete Gallego (D-Texas). (Photo provided by the Texas Credit Union League) …
  • RALEIGH, N.C. (3/18/13)--The Carolinas Credit Union Foundation (CCUF) Board of Directors announced it has elected Chuck Purvis to fill a board vacancy. Purvis, president/CEO of Raleigh-based Coastal CU, is former chairman of the National Credit Union Foundation (NCUF)  and was a member of its board from 1995 to 2007. He is a champion of the Community Investment Fund, a family of funds that has become a major source of funding for NCUF. He joins Brian Sponaugle, chief operations officer of Greenville (S.C.) FCU, and Michelle Bragg, chief operating officer of Sharonview FCU, Fort Mill, S.C.,  as the three newest CCUF board members added since July, according to the North Carolina Credit Union League's newsletter, The Weekly Conversation (March 15) …

More CUs Line Up To Assist Members In Sequestration

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MADISON, Wis. (3/18/13)--News Now has heard from at least a dozen more credit unions that serve federal employees and are offering programs to help their members through furloughs generated by the federal government's budget cuts, or sequestration.

That is in addition to 25 credit unions from 14 states News Now reported in two articles the week after sequestration began March 1. The latest group continues to indicate the widespread impact of the furloughs. Those credit unons are helping members in Kentucky, Washington state, Virginia, Nebraska, Oklahoma, Kansas, California, and Washington, D.C.

As many as one million federal employees are expected to lose 20% of their paychecks between April and the end of the fiscal year in September. They could be furloughed for up to 176 "noncontinguous hours," which add up to 22 eight-hour workdays, according to Fort Knox FCU, Radcliff, Ky. (The News-Enterprise March 9).

Bill Rissell, the $1 billion asset credit union's president/CEO, told the publication that the Fort Knox area has more than 5,000 Department of Defense (DoD) civilians and contractors impacted by the sequestration.

As a result, Fort Knox FCU will reactivate its interest-free loan for 30 days, an offer previously used during disasters or emergencies. It will also extend furlough loans as an interest-only payment after the initial 30 days. Members can also request a temporary, interest-only payment on current loans for three months. That would reduce, for example, an auto loan payment from $325 a month to less than $55. And members can take early withdrawals of up to $10,000 from share certificates of deposit.

Education is also at the forefront of credit unions' assistance to furloughed members and the public. Three credit unions in Washington state--Connection CU of Silverdale; Kitsap CU of Bremerton and Peninsula Community FCU in Shelton--are working as a group to help the community prepare for furloughs. They are sponsoring a free community event, Surviving Sequestration: A Community Town Hall, on March 26. The event will feature speakers and a resource fair to provide attendees help addressing financial, physical and emotional needs during the times of financial change.

Their main message: Credit unions are here to help.  They said they want to work with their members and community to be proactive in thinking through their household financial scenario during furloughs. The community has 16,000 local DoD civilian employees, contractors, families and others facing furloughs.

Many of the nation's credit unions offering assistance are taking the extra steps to work with individual members  to customize plans tailored to the individual's circumstances.

In Alexandria, Va., Commonwealth One FCU said it "understands that each member's situation is unique and they will be affected differently by the government's action." 

"The first step in the process of sequestration is for the member to understand their financial situation before they can factor in the effects of sequestration on their income," Commonwealth One said in a press release. Its free, online debt analysis tool, Debt In Focus, provides a personalized financial assessment in plain language.  The credit union also encouraged members to contact itto discuss a solution tailored to their needs and established a hotline to allow members easy access.

"We're here to help our members through the challenges of facing a reduced income," said Ashley Baldeon, Commonwealth One's marketing manager.  "We thoroughly support 'people helping people."

Vacaville, Calif.-based Travis CU echoed that thought. "We are here for our members and are doing everything we can to support them during these challenging economic times," President/CEO Patsy Van Ouwerkerk said in The Davis Enterprise (March 10). "Members are encouraged to visit any of our branches so that we can work with them to address any financial difficulties that these furloughs and loss of income may create."

Other credit unions reporting furlough assistance programs included: Global CU in Spokane, Wash.; SAC FCU in Bellevue, Neb.; Frontier Community CU, Leavenworth, Kan.;  Transportation FCU, Washington, D.C.; and FAA CU and Tinker FCU, both located in Oklahoma City, Okla.

PCUA Hosts MBL Participations Conference

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HARRISBURG, Pa. (3/18/13)--The Pennsylvania Credit Union Association's Member Business Lending (MBL) Participations Conference and Buyer/Seller Networking featured several expert speakers Thursday in Lancaster.

A Pennsylvania Credit Union Association panel discussion on member business lending  participations included, from left: Rick Wieczorek, Mid-Atlantic Corporate FCU, Middletown; Dallas Zulli, AmeriChoice FCU, Mechanicsburg; Tammy Baker, Members 1st FCU, Mechanicsburg; Robert Fox, American Heritage FCU, Philadelphia; and Jeff Judy, Jeff Judy & Associates. (Photo provided by the Pennsylvania Credit Union Association)
The event attracted more than 50 people from 30 credit unions in four states. It was sponsored by Keystone Business Lending Services LLC and Member Business Financial Services LLC (Life is a Highway March 15).

Kevin Dion, vice president of business lending for Citadel FCU, Exton, explained the basics of loan participations and why the basics are critical to comprehend. Bill MacMaster, National Credit Union Administration regional lending specialist, provided information about the NCUA's perspective on MBL participations and answered questions.

PCUA staff attending included: Rick Wargo, executive vice president/general counsel; Molly Snody, director, business advisory services; and Glenn Cermak, director, education and professional development.

The Credit Union National Association and credit unions reintroduced in Congress last month legislation to raise credit unions' member business lending cap to 27.5% of total assets, from the current 12.25%. Doing so would generate $14.5 billion available for MBLs and increase jobs by 158,000 in the first year, without costing the taxpayer, according to new statistics from CUNA.

Three Olympians To Compete In CU Cherry Blossom Run

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WASHINGTON (3/18/13)--U.S. Olympians Janet Cherebon-Bawcom, Jen Rhines and Colleen De Reuck will compete in the upcoming USA Women's 10-Mile Championship, presented by America's Credit Unions, which will be held in conjunction with the 2013 Credit Union Cherry Blossom 10-Mile Run in Washington, D.C. April 7.

On the men's side, last year's winner, Allan Kiprono, will return to defend his title, and will face 2012 runner-up Lani Kiplagat.

"The American women will be racing for both open and U.S. Championship prize money, with $14,400 specifically earmarked to be paid to the top 10 American women," said race director Phil Stewart.

De Reuck set the women's course record of 51:16 in 1998, when she competed on behalf of the Republic of South Africa. Kiprono set the men's course record last year in a time of 45:15, which was the fastest 10-mile time of the year and the fifth fastest of all time.

Cherebon-Bawcom was a finalist in the 10,000 meters for the U.S. in last summer's London Games. Rhines represented the U.S. in the 5,000 meters, 10,000 meters and marathon in the Beijing, Sydney and Athens Olympics, respectively. De Reuck competed for the U.S. in the marathon in Athens, after representing South Africa in Barcelona, Atlanta and Sydney.

Credit Union Miracle Day, the sponsor group of a family of races, in cooperation with the Credit Union National Association and the National Association of Federal Credit Unions, secured the naming rights for the championship run. The championship name will say it is Presented by America's Credit Unions (News Now Feb. 20).

More than 26,000 runners submitted applications to participate in the 2013 Credit Union Cherry Blossom 10 Mile and 5K.

Since 2002, the Credit Union Cherry Blossom 10 Mile and 5K have raised more than $5.5 million for the Children's Miracle Network Hospitals under the umbrella of Credit Unions for Kids.

League Testifies Fourth Time On Elder Abuse, Signage

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PORTLAND, Maine (3/18/13)--The Maine Credit Union League provided testimo­ny before state legislative committees for the fourth time in less than two weeks about pending legislation on elder abuse and signage to promote small businesses.

Quincy Hentzel, league director of governmental affairs, addressed the Criminal Justice and Public Safety Commit­tee at a Wednesday public hearing in support of L.D. 527, which would implement measures to help protect the elderly and vulnerable adults from being exploited (Weekly Update March 15).

"Abuse of elderly citizens is a very serious and extremely devastating and heart-breaking crime, and its occur­rence has unfortunately been increasing over the years," Hentzel explained to the committee. "Speaking on behalf of the credit union industry, the type of abuse we see all too often is that of financial elder abuse. Maine's credit unions have been proactive in provid­ing information, building awareness and working to help prevent elder and dependent adult financial abuse, and support any and all initiatives that aim to deter this type of behavior."

Last year, the Credit Union National Association, state leagues and credit unions coordinated efforts to curb elder financial abuse. Steps taken by those groups were detailed in a CUNA comment letter to the Consumer Financial Protection Bureau in August (News Now Aug. 22). CUNA also has conducted webinars on elder abuse.

Hentzel testified March 8 in support of L.D. 483--which would enhance the use of on-premises signs to promote small businesses.

Hentzel noted before the legislature's Trans­portation Committee that the legislation "would provide support for the many businesses in this state by allowing them greater latitude for their on-premises advertising by permitting them to use their electronic signs to their full capacity.

"In order to help build awareness for our industry, a number of credit unions across the state have already purchased electronic signs as a means of informing and promoting the products and services we offer to our members and consumers," she added. "These signs represent a significant financial investment, costing upwards of $40,000 or more."

Work sessions for the two bills have not been scheduled.

Yo, Listen Up! Puppet Rappers Tout CUs' Student Loans

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NEW YORK (3/18/13)--The Muppets have captured the imagination of adults and children for decades. Now, cuStudentLoans, powered by LendKey, is hoping videos featuring "hip" Muppet-like characters and rap music will encourage college students to learn about credit unions and student loans.

LendKey is a CUNA Strategic Services provider.

cuStudentLoans' Squeaky Jams YouTube video series features a bear, Business Barry, and a squirrel, Squeaky, rapping to their puppet friends about real-world finance and how credit unions and student loans can help them meet everyday challenges.

Barry and Squeaky are more than entertainers. Among the issues addressed in the five-part series:

  • The difference between student loan consolidation and refinancing;
  • How to lower the interest rate on a student loan;
  • What to do if the student can't afford student loan payments; and
  • The benefits of credit unions.
To view the videos on YouTube, use the link.

New Video Educates About NCUF Mission

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MADISON, Wis. (3/18/13)--The National Credit Union Foundation posted a new video on YouTube Friday providing a general overview about the foundation, its mission and its programs.

The two-minute long video touts the credit union people helping people philosophy and centers on telling how the foundation makes financial freedom achievable. The video points to NCUF programs such as Real Solutions, Credit Union Development Education, the award-winning national public television program Biz Kid$, grants, and CUAid, the movement's disaster relief program.

To view the video, use the link.