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Move Your Money hits Montana

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HELENA, Mont. (3/4/10)--The Move Your Money campaign urging consumers to move their funds from large national banks to more local credit unions and community banks for better service has drifted West to Montana, reports the Montana Credit Union Network. A segment on KFBB TV, which serves the Great Falls and Helena areas, noted "Why more Montanans trust their money to credit unions." And in a letter to the editor of The Missoulian, a member tells why he ditched Chase to join a credit union. On the KFBB-TV segment, Kathy Briggs, manager of Family First CU, Great Falls, explained that most people realize that their money benefits the owners of the banks, not the customers. "So they turn to a credit union where the members are the owners, and we're not trying to generate an artificially high profit for someone who will never walk through the doors," she said, noting credit unions "epitomize the Main Street versus the Wall Street dichotomy." The station interviewed Bill Garcia, who switched from a larger chain bank to Great Falls Teacher's FCU. "I walked in the door this morning, and Julie at the desk said, 'Hi, Bill.' It's just something you don't typically see." He asked for a motorcycle loan and liked the personal service so much he brought his other accounts--and a few friends--to the credit union. "It's actually uplifting. If you're having a bad day, just come in and check your balance and you'll feel better," Garcia said. Julie McCamley of Teacher's FCU said consumers get lost in a larger institution, but the credit union strives to prevent that. "We don't want them to be just another number. We want to know their names. We want them to be comfortable." In his letter to the Missoulian posted Feb. 27, Joe Splinter of Billings wrote that he moved his funds from "too-big-to-fail" Chase Bank, which received government bailouts that made him "appalled." He moved "all my money to a wonderful, local, welcoming, caring, not-for-profit credit union right here in Billings." He urged the state, local and county governments to put their funds in small, local banks and community-owned credit unions. To access the television segment and the letter, use the links.

SBA names USC CU staffer as 2010 Financial Services Champ

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LOS ANGELES (3/4/10)--USC CU and its vice president of commercial services, David Mellman, have been named the 2010 Financial Services Champion of the Year by the Los Angeles District Office of the U.S. Small Business Administration (SBA). Champion awards will be presented by SBA as part of National Small Business Week Awards Ceremony this summer. "Through the work of lenders and advocates like yourself, jobs are created, families live fuller lives and whole communities are transformed," said Albert Alvarado, district direction of the L.A. office. Since launching its SBA program in 2007, USCCU has funded numerous SBA loans for members of the USC and Los Angeles communities. "We don't close loans; we establish relationships with our borrowers because of our shared connection with the Los Angeles community," Mellman said. "Our goal is to provide each and every one of our clients with opportunities to access the necessary capital that will insure their success." Nominations are evaluated on these criteria:
* Outside of regular business duties, the amount and quality of assistance given small businesses to obtain financing; * Advocacy for changes in the financial services industry to assist small companies; * Encouragement of the flow of investment capital to small ventures; * Active support for legislative or regulatory action designed to help small firms; and * Other significant contributions through the advocacy efforts of the financial services or accounting industries to advance small business interests.

Kanjorski to Pa. auto dealers Try CUs for loans

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SCRANTON, Pa. (3/4/10)--One auto dealer in Northeast Pennsylvania is seeing the benefits that increased business lending for credit unions could offer the rest of the economy. After being rejected by nine banks, Ertley Dealership in Scranton, was approved for a loan by Cross Valley FCU. Dealership President Ron Ertley got the loan after taking the suggestion of Rep. Paul Kanjorski (D-Pa.) (Scranton Times-Tribune March 3). Kanjorski, meeting with a group of local auto dealers having difficulty accessing credit from banks, suggested they try credit unions. The story noted Kanjorski’s work to expand credit union business lending through legislative means. Credit union business lending increased by over 11% last year, and Kanjorski told the Times Tribune that credit unions need Congress’s help “to fill a void in business lending.” Kanjorski is sponsor of HR 3380, the Promoting Lending to America's Small Business Act, which would enable credit unions to make more small-business loans.

CU System briefs (03/03/2010)

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* HERNDON, Va. (3/4/10)--Northwest FCU Foundation plans to award $90,000 in scholarships by April 15th. The foundation has two scholarship programs: the Ben DeFelice--named for Northwest FCU's longest-serving board member--and the CIRA scholarships. This year, the foundation will award 15 Ben DeFelice scholarships of $5,000 each and six $2,500 CIRA scholarships to students demonstrating leadership, dedication and commitment in the home, school or community. Since the program's first recipients were honored in 2005, the foundation has awarded $239,000 in scholarships ... * NAPERVILLE, Ill. (3/4/10)--Hawthorne CU has formed a Student Advisory Committee (SAC) to learn more about the banking experiences and needs of Generation Y consumers. The committee, with 16 local individuals ages 18-29, meets once a month to discuss issues such as what Gen Y-ers look for in a financial institution, their preferred forms of communication, the types of programs that appeal to them, and how credit unions can become more appealing to them. The group's first meeting, in February, identified the most important factors for choosing a financial institution--convenience and trust. The group said convenience translates into technology that allows them to access accounts via computers and mobile phones. They didn't want to be tricked or nickeled and dimed with fees, preferred a financial institution that looks out for their interest, and would stick with a financial institution as their needs grow. SAC members are paid a stipend per meeting, with an added bonus for perfect attendance ... * WARMINSTER, Pa. (3/4/10)--Freedom CU has launched its official Twitter page as part of an overall social networking initiative aimed at educating and adding value to its members. The Warminster, Pa.-based credit union hopes to broaden its marketing reach by informing members about credit union news, community events and product offers via tweets. To become a follower, visit PA. Freedom CU also can be found on Facebook ...

CUs asset quality shows some deterioration

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MADISON, Wis. (3/4/10)--Credit union asset quality continued to deteriorate in January, with the delinquency rate rising six basis points to 1.92% from year-end 2009, according to a Credit Union National Association (CUNA) economist’s analysis of CUNA’s monthly review of credit unions for January. “The last time credit union loan delinquency rates were this high, Ronald Reagan was president,” Steve Rick, CUNA senior economist, told News Now. “Over the recent business cycle, credit union delinquency rates reached their nadir in April 2006 with a reading of 0.53%. “Credit unions should expect loan delinquency rates to rise further over the next few months,” Rick added. “Expect job creation to be weak for the next six months because firms are still reluctant to bring on new workers during this time of great economic and government-economic-policy uncertainty. In other words, firms are having a hard time determining the marginal benefit and marginal cost of an additional worker.”
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The rise in long-term unemployment is a serious concern for credit unions’ asset quality, Rick said. “There are currently more than six million people who have been unemployed for more than six months, up from one million two years ago,” he explained. “And the number is still rising. Many long-term unemployed are facing severe financial difficulties with little hope of landing a job anytime soon.” Credit union loans outstanding decreased 0.5% during January, down from a 0.3% increase during January 2009. Fixed-rate mortgages led loan growth, rising 0.4%, while used-auto loans and home equity loans each declined 0.1%. Unsecured personal loans dropped 0.5%, followed by other mortgages (0.9%) and new-auto loans (1.5%). Credit card loans also decreased 1.5%, and adjustable-rate mortgages fell 1.9%.
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“Credit union loan balances fell for the third consecutive month in January,” Rick said. “Weak loan demand on the part of members and loan sales on the part of credit unions is responsible for the remarkably low 0.2% growth in loan balances over the last year.” Credit union savings balances decreased 0.4%, down from a 1.7% increase during January 2009. Money market accounts rose by 1.5%, followed by regular shares, which increased less than 0.1%. Individual retirement accounts declined 0.8%, followed by one-year certificates and share drafts, which dropped 1.1% and 2.7%, respectively. The loan-to-savings ratio remained at 76%. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--stayed at 19%. The movement’s overall capital-to-asset ratio in January remained at 10%. The total dollar amount of capital is $90 billion.

HFOT projects see progress in Missouri Mass.

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MARLBOROUGH, Mass., and ST. LOUIS (3/4/10)--Two credit union projects with Homes for Our Troops (HFOT), which builds specially adapted homes for severely injured veterans, have made significant progress in Massachusetts and Missouri. At a ceremony attended by 200 supporters, SSG Michael Downing and his family received the keys to their new home in Middleboro, Mass., reported the Massachusetts Credit Union League's E-Weekly March 3). Downing lost both legs to a road side bomb in Afghanistan. The Massachusetts Credit Union League, the New Hampshire Credit Union League and the Credit Union Association of Rhode Island were among the contributors making the project possible. Credit unions from the three leagues began their involvement with the project in Spring 2009 with a commitment to sponsor the Annual Gala for HFOT. The three leagues raised $190,000 and were recognized at the ceremony by HFOT founder John Gonsalves. "Our credit union community is proud to be able to be of service to Staff Sergeant Downing, an individual who has given so much to all of us," said the leagues' President/CEO Dan Egan. Other major sponsors were Cape Cod Lumber and Falconeri Construction, which donated time, labor and expertise for the project. Among those attending the ceremony were U.S. Sen. Scott Brown (R-Mass.) and Major General Joseph Carter, commander of the Massachusetts National Guard. Halfway across the country, the Missouri Credit Union Association (MCUA) reported that with donations and labor pouring in, HFOT expects to start excavation work this week on a home in Columbia, Mo., for SSG Robert Canine. Canine lost both legs below the knee during an explosion in May during his second stint in Iraq (The Missouri difference March 3). Missouri credit unions are leading the effort to build the home. The next step in the process is a three-day build brigade, which brings the house from a concrete foundation to a weather-tight structure within three days. Credit union representatives, volunteers, community members and the media will take part in that actively, which likely will occur in April, said MCUA. Credit unions, leagues and the Credit Union National Association also partnered with HFOT and the national presidential conventions in Minnesota and Colorado for similar home projects in those states in 2008.

N.J. state ad campaign kicks off this month

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HIGHTSTOWN, N.J. (3/4/10)--The New Jersey Credit Union League’s Statewide Advertising Campaign will branch into some new areas this month. The campaign will include advertising on New Jersey Transit buses and in train stations, radio ads on 95.5 FM WPLJ and, and ads in The New York Times Sunday edition, said the league (The Daily Exchange March 3). On March 14, an ad will appear in The New York Times’ New Jersey section. Another ad will appear in the March 22 issue, which is dedicated to credit unions and will feature an interview with league President/CEO Paul Gentile. On March 15, New Jersey Transit buses will feature credit union advertising, as will several train stations statewide. The ads will run for 26 weeks. Also on March 15, Radio station 95.5 FM WPLJ will begin airing the league’s 30-second general information radio commercial via on-air and Internet streaming stations. The ads will run through the beginning of September. Running through the start of September will be the league’s Internet advertising, which will reach more than four million state residents per month. By the end of March, the league should roll out its Banking You Can Trust toolkit. It will provide credit unions access to customizable ads and other marketing materials focusing on the products and services. The customization is free to credit unions. Printing of materials--if necessary--is the only cost.

Invest in America adds DIRECTV Miracle Network

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LIVONIA, Mich. (3/4/10)--America’s credit union members can invest, donate and save all at the same time when they sign up with a nationwide satellite TV service, while helping sick and injured children in local community hospitals. A new partnership between Invest in America and DIRECTV will launch April 1. Through the exclusive members-only program, credit union members will receive $5 off per month on the first 12 months of a DIRECTV subscription, in addition to any other DIRECTV promotions. Also, $15 will be deposited into their credit union savings or checking account. Through this partnership, CUcorp will also donate $10 for each new subscriber to Children’s Miracle Network, a nonprofit organization credit unions work with to benefit children’s hospitals. CUcorp, a marketing company based in Livonia, Mich., holds contracts with U.S.-based companies for exclusive credit union member discounts through the Invest in America program. DIRECTV has been America’s No. 1 satellite TV provider for the past 15 years, delivering programming to more than 18 million households, said CUcorp. Children's Miracle Network is an international non-profit that raises funds for 170 children's hospitals. The hospitals provide state-of-the-art care, research, preventative health education and treatment for seriously ill children. Credit unions have been one of Children’s Miracle Network’s top contributors since 1996 when the Credit Unions for Kids program launched nationwide. Since its inception, the Credit Unions for Kids program has generated more than $75 million for children’s hospitals. “The evolution of Invest in America is to add new partnerships,” David Adams, CUcorp CEO, told a teleconference Wednesday. “This is an exciting new enhancement to the program in which credit union members will benefit from another opportunity to save a few dollars because of their credit union membership. “This will be a catalyst for deepening the credit union relationship, giving members more reasons to do business with credit unions,” Adams added. “This credit union-DIRECTV campaign is just one more example of how credit unions are giving back to their local communities,” said Joe Dearborn, senior managing director for Children’s Miracle Network and the Credit Unions for Kids program. “Last year alone, the credit union movement raised almost $8.5 million for Children’s Miracle Network, which allowed affiliated children’s hospitals to provide care for 17 million kids.” In addition to DIRECTV, Invest in America partners include General Motors, Chrysler, Sprint, Costco, FTD, CU Benefits Express, Allied Moving and Storage, CompleteTax and ELS Vacation Destinations.

Wis. CUs win 4th Governors Award for investment ed

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PEWAUKEE, Wis. (3/4/10)--Wisconsin credit unions are receiving their fourth Governor’s Financial Literacy Award in five years--this time for an investor education project involving 3,520 employees from 80 credit unions in more than 30,000 hours of online investment education. The effort is the largest of its kind by financial institutions there, said the Wisconsin Credit Union League, and is part of an ongoing study of how investor education can motivate investing behavior. It positions the co-ops to urge their 2.2 million members to greater investing. “Even though more Americans began saving and paying down debt last year for fear of losing a job, too few are investing regularly--something they’ll need to do to stay afloat financially beyond their working years,” said Brett Thompson, league president/CEO. The league is coordinating credit union involvement in the effort. By educating more of their staff on their own savings and investment options, credit unions "could be more proactive in helping steer members toward resources, whether in-house, online or within their communities,” he said. Studies have found that most Americans appear not to have done any retirement planning. The project, dubbed “RP3,” for REAL Progress & Pathways to Prosperity, kicked off in October and will continue through early 2011. Participants took roughly 10 hours of online learning about investing concepts such as setting goals, distinguishing among investment vehicles, managing risk, diversifying a portfolio, maximizing tax advantages, understanding mutual funds and working with investment professionals. The first phase involved 53 credit unions, whose 1,623 employees completed the courses in December and achieved passing grades averaging 88.17%. Their knowledge of investing concepts had increased 28.27%. In January, another 1,897 employees from 56 credit unions began the coursework. At its conclusion, the 18-month project will have collected enough data to measure the extent that learning had on participants’ investing behavior and what factors--such as income and age--influenced success. The study is conducted in partnership with the Puelicher Center for Banking Education at the Wisconsin School of Business, University of Wisconsin-Madison; Precision Information; the Wisconsin Credit Union League; Governor Jim Doyle’s Council on Financial Literacy; and the Wisconsin Department of Financial Institutions. It is funded by a grant from the Investor Protection Trust (IPT), a nonprofit organization devoted to investor education. Wisconsin credit unions have earned three other Governor’s Financial Literacy awards: in 2009, for their 86 in-school credit union branches instilling in students the habit of regularly saving money; in 2008, for providing free to all Wisconsin public high schools a lifestyle money magazine and online tools for teachers and students to support state teaching standards for financial literacy; and in 2006 for their overall, statewide REAL Solutions initiative teaching families to save and build wealth.

CUs 2009 Roll Your Change deemed most successful

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AKRON, Ohio (3/4/10)--Towpath CU’s “Roll Your Change” campaign was deemed the most successful last year in the U.S., according to America Saves officials. America Saves is a program by a national nonprofit group to highlight the importance of saving money. Last year, the program worked with leaders in Akron, Ohio, to offer an Akron Roll Your Change Week, with which Towpath was involved. America Saves 2010 was held last week. Fairlawn, Ohio-based Towpath garnered $266,000 in loose change with 833 new deposits and 188 new accounts over a four-day period last year (The Beacon Journal Feb. 28). About 70% of the accounts that were opened during its loose change promotion have remained into 2010. The project also is being nominated for a leadership recognition award through the Ohio Credit Union League, said the newspaper. Although Towpath did not participate in the campaign this year, it is looking to get its own coin counter and offer a program later this year. The credit union had borrowed a coin counter last year and offered a 10% match to anyone depositing money into an account--up to a maximum $100. Towpath also gave $100 three-month share certificates to the highest coin depositors. Towpath has $67.7 million in assets.

CUs launch Perus first member-owned ATMs

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AYACUCHO, Peru (3/4/10)--Santa Maria Magdalena CU celebrated the launch of its first ATMs last week in Ayacucho, Peru. The launch was a landmark for the $50 million asset credit union, which is piloting ATMs for expansion to credit unions throughout the country, said the World Council of Credit Unions (WOCCU).
Click to view larger image Celebrating Peru’s first credit union-owned ATMs at Santa Maria Magdalena credit union in Ayacucho were, from left: James Chira, Kuskanet general manager; Miguel Zevallos, FENACREP board president; Mark Cifuentes, World Council of Credit Unions vice president of technical services; and Roque Montero, Santa Maria Magdalena board president. (Photo provided by the World Council of Credit Unions)
“The ATM launch puts Peru’s credit unions on par with other financial institutions in a race to the forefront,” said Mark Cifuentes, WOCCU vice president of technical services. “The credit union’s goal has always been to offer members the same services bank clients receive. The ATMs help bring them the financial dignity all people deserve.” Santa Maria Magdalena’s ATMs mark the next step forward for Peru’s first credit union-owned network, launched in October 2008 as “Kuskanet.” Kuska means “together,” Kuskanet is a credit union services group wholly owned by WOCCU; Federacion Nacional de Cooperativas de Ahorro y Credito del Peru (FENACREP), Peru’s national credit union association and a WOCCU member; and mostly rural credit unions. “Working closely with FENACREP, WOCCU’s program in Peru laid the foundation for the advancements we celebrated in Ayacucho last week,” added Brian Branch, WOCCU executive vice president and chief operating officer. “Farmers, small business owners and people living in rural areas are now experiencing financial access as they thought only bank clients could.” Kuskanet can give credit unions the tools necessary to offer the same financial services as banks at more affordable rates. When Kuskanet launched, no credit unions in the country offered ATM or debit card services. Very few credit unions provided members the opportunity to perform inter-branch transactions, which were possible only through credit union-to-credit union agreements. Shared supply and demand among network members has enabled small credit unions to offer new products and services, WOCCU said. Santa Maria Magdalena’s ATMs will serve 60,000 members in largely rural areas, and members in urban centers near Lima. Kuskanet chose Santa Maria Madgalena to pilot the ATMs because of its commitment to using new technology to expand product and service offerings to members. Kuskanet offers ATMs, point-of-sale (POS) devices and shared branching services to its 20 member credit unions. There are three credit union-owned ATMs in operation--in Santa Maria Magdalena’s main office, one in a branch office and a third at a credit union in Tarapoto. On Saturday, Kuskanet will celebrate ATM launches in Rioja province, an area high in poverty between the Amazon rainforest and the Andes Mountains. The network plans to install 45 credit union-owned ATMs and 200 POS devices throughout Peru by the end of 2010. Kuskanet grew out of WOCCU’s first technical assistance program in Peru, funded by the U.S. Agency for International Development.