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CU System Briefs (04/19/2013)

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  • PALO ALTO, Calif. (4/19/13)--Police have arrested a man suspected of robbing a Palo Alto, Calif., branch of Provident CU Saturday. The man was convicted last year of running from police after driving onto a street sealed off for President Barack Obama's motorcade. Eddie Darrell Boyce Jr., 50, was arrested Tuesday morning, the Palo Alto Police Department said. A man matching Boyce's description allegedly handed a note to a teller demanding cash at the branch Saturday morning. The man warned that he had a gun, but no weapon was seen. Police arrived within a minute of receiving the call at 9:05 a.m. but the man escaped with an undisclosed sum of money. Boyce was identified from a surveillance image ...
  • HARRISBURG, Pa. (4/19/13)--Diana L. Roberts, president/CEO of Hummelstown, Pa.-based Hershey FCU,  will retire in July after more than 31 years' service, reports the Pennsylvania  Credit Union Association (Life is a Highway April 18). Paul Wagner, an HFCU employee since 2005 and current vice president of operations and lending, will succeed her. In 1982, Roberts joined HFCU, which had $2.2 million in assets and served 1,675 members. Today the $58 million asset HFCU serves more than 7,000 members with three branches. She has served on PCUA's board of directors since 1982, including as chairman from 2007 to 2009. She was chairman of Pennsylvania Credit Union Foundation board in 2009-2011 and is an ex officio, Roberts also served as a Credit Union National Association director from 1997 to 2008 and was inducted into the national Credit Union House Hall of Leaders in 2010. Wagner has 35 years of experience in financial services industry, including with banks and another credit union ...
  • SALEM, Ore. (4/19/13)--Larry Queen, former president/CEO of  State Employees' CU in Salem Ore., died April 12 in Salem (Statesman Journal April 17).  He was 70. Queen and his wife of 40 years, Lynda Queen, worked side by side growing the small credit union, which he considered his proudest achievement.  His passion of helping people and achieving his fullest potential of a job well-done was fulfilled through the credit union's successful merger with First Tech FCU just before his retirement in 2008. He is survived by his wife, a son, two daughters, nine grandchildren and a great grandson. Funeral arrangements are being made through Howell Edwards Doerksen Funeral Home. A memorial service will be Saturday at 2:30 p.m. PT at South Salem Church of the Nazarene ...

International CU Regulators Issue Governance Guidelines

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SAN DIEGO (4/19/13)--The International Credit Union Regulators' Network (ICURN) this week issued a new guiding principles document, Enhancing Governance of Cooperative Financial Institutions at the ICURN Annual Conference in San Diego.

Click to view larger image Forty-eight credit union regulators from 23 countries attended the International Credit Union Regulators' Network Annual Conference in San Diego this week. (Photo provided by the World Council of Credit Unions)
"Cooperative financial institution governance is in many respects the most important line of defense in terms of maintaining safety and soundness, and cooperative financial institutions globally face similar governance challenges," said Andy Poprawa, ICURN chairman and CEO of the Deposit Insurance Corp. of Ontario, Canada.

"These new guiding principles will help many institutions and their boards understand better their responsibilities and give a road map on how to manage an institution so that it serves its members' needs to the greatest extent possible," he added.

The ICURN guidance incorporates 17 elements considered desirable in facilitating effective governance of cooperative financial institutions, including credit unions and savings and credit cooperative organizations.

The elements include:

  • Directors' responsibilities and minimum qualifications;
  • Oversight of senior management;
  • Senior managers' roles in maintaining safe and sound institutions;
  • Effective internal controls;
  • Compensation;
  • Transparency and disclosure to members; and
  • The role of regulators in monitoring cooperatives' corporate governance and taking remedial action when appropriate.
The document builds on prior ICURN guidance on cooperative financial institutions supervision. In September 2011, ICURN issued Guiding Principles for Effective Prudential Supervision of Cooperative Financial Institutions, which incorporated 21 principles conducive to developing an effective supervisory system for financial cooperatives.

At this year's ICURN Annual Conference, 48 regulators from 23 countries in Africa, Asia, North America, Latin America, the Caribbean, Europe and Oceania participated. The National Association of State Credit Union Supervisors and the California Department of Financial Institutions hosted the conference.

ICURN is an independent international network of cooperative financial institution regulators that promotes the guidance given by the leaders of the Group of 20 nations for greater international coordination among financial services regulators.

The network facilitates the sharing of information and positions of common interest among financial cooperatives, initiates research on financial cooperatives and their oversight, identifies best practices and provides direct access to a forum for thought leaders worldwide on issues critical to sound cooperative financial institutions regulation. The World Council of Credit Unions serves as the ICURN secretariat.

For more information about ICURN, visit use the link.

CUs First FIs In Canada To Offer Remote Deposits

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VANCOUVER, B.C. (4/19/13)--Credit unions will be the first Canadian financial institutions to offer remote deposit capture.

Through Credit 1 Central in Vancouver, three credit unions--Meridian CU, St. Catharines, Ont.; Affinity CU, Saskatoon, Sask.; and Westminster (B.C.) Savings CU--will offer Deposit Anywhere as part of their mobile banking application.

"We are constantly developing new, innovative ways for credit unions to meet the changing needs of their members," said Oscar van der Meer, chief technology officer at Central 1, the trade association and financial facility for credit unions in British Columbia and Ontario. "We help them keep in the lead of the rapidly developing financial services market."

Members of the credit unions can use the camera in their mobile device to snap an image of the check they want to deposit and use their mobile banking app to deposit the item electronically.

Deposit Anywhere will be broadly available for credit unions to begin implementation in June.

Home Finance Write-offs Drop 23% In First Quarter

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ATLANTA (4/19/13)--U.S. home finance balances written off in the first quarter totaled  $43.1 billion, a decrease of  nearly 23% from first quarter 2012 ($55.4 billion), according to the Equifax March National Consumer Credit Trends Report. That reflects a five-year low.

Write-offs, also known as severe derogatories, include loans that completed the foreclosure process and transitioned to real-estate owned (REO) by banks, entered bankruptcy, or were otherwise charged off by the lender.

"Overall home finance balances decreased to $8.38 trillion in March 2013 from $8.64 trillion the same time a year ago," said Equifax Chief Economist Amy Crews Cutts. "The decline is due to write-offs from foreclosures as well as from consumers paying down balances when refinancing, known as cash-in refinancing, shortening terms when they refinance their loans or making extra principle payments each month for faster amortization; some have even paid-off their mortgages entirely.

"The share had been running 50-50 until recently when it has shifted to a 60-40 split with write-offs dominating," she added. "This shift is important as increased home purchases are finally leading to more demand for mortgage credit and may soon stop the decline in mortgage debt outstanding."

Year-over-year change in home finance write-off rates from March 2012 to March 2013 were:

  • Home equity revolving: Declined 44.1%;
  • Home equity installment: Dropped 32.9%; and
  • First mortgage: Fell 17.6%.
Year-over-year change in home finance severely delinquent balances during the period were:

  • Home equity revolving: Decreased more than 29% (to $9.7 billion from $13.6 billion);
  • Home equity installment: Fell nearly 26% (to $4.9 billion from $6.6 billion); and
  • First mortgage: Dropped nearly 25% (to $355 billion from $477 billion).

Louisiana League Hosts Young Professionals Workshop

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HARAHAN, La. (4/19/13)--Eighty-five employees from 25 credit unions attended the Louisiana Credit Union League's second Young Professionals Network (YPN) Workshop April 13 in Lafayette, La. Attendance increased 25% from the first year of the event, LCUL said.

Click to view larger image The Louisiana Credit Union League's second Young Professionals Network Workshop April 13 attracted 85 credit union employees--a 25% increase from last year's inaugural event. (Photo provided by Louisiana Credit Union League.)
"Young professionals are the future of our industry," said Ronaldo Hardy, chairman of the YPN Steering Committee. "To have 85 people willing to give up their Saturday is a testament to the strength of the credit union movement."

A full day of sessions and networking opportunities began with a presentation from Kathi Gill, CEO of Neighbors FCU, Baton Rouge. Gill shared her career experiences as it progressed from teller and to leader of one of the state's largest credit unions.

Matt Monge, chief culture officer at Mazuma CU, Kansas City, Mo., facilitated a networking session, then gave a keynote presentation on the culture of credit unions and how it relates to young professionals.

Other session topics included credit union advocacy, a review of league resources, lending, marketing and leadership.

To increase young credit union professionals' involvement in political advocacy, LCUL and the YPN awarded two scholarships to attend the League's Governmental Affairs Conference in Baton Rouge, May 14-15. The league will cover registration costs and the YPN will cover accommodations. All YPN workshop attendees were eligible for the drawing.

Pa CUs Well-capitalized At Year-end 2012

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HARRISBURG, Pa. (4/19/13)--The percentage of Pennsylvania credit unions deemed well-capitalized--with Prompt Corrective Action net worth above 7%--stood at 96.6%, slightly higher than the national average of 96.3%, reported the fourth quarter 2012 Pennsylvania Credit Union Profile.

The rise in overall loan balances for the fourth quarter was driven by credit cards and mortgage loans, and the increase was slightly higher than national averages, said the Pennsylvania Credit Union Association. Loan balances the past year increased 4.4%--the fastest pace in three years (Life Is a Highway April 15).

Pennsylvania credit unions reported slightly higher fourth-quarter loan-delinquency numbers. However, relative to Pennsylvania banks, credit union delinquency rates of 1.13% are below the bank-reported rate of 1.7% for the period, PCUA said.

Pennsylvania credit unions' fourth-quarter membership growth was slow, but remained strong with an overall 2% increase in 2012,  PCUA said. Net memberships grew by 73,000 in 2012 to reach nearly 3.73 million.

British CUs Win Gov't Grant To Combat Payday Lenders

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LONDON (4/19/13)--The British government has awarded US$58.1 million to the Association of British Credit Unions Ltd. (ABCUL) to enhance access to credit unions as an alternative to payday lenders and provide greater access for more people to credit unions.

The money will be spent on modernizing credit unions with new computer systems and an infrastructure so they can offer a wider range of products and services to more consumers, said ABCUL (Financial Times April 16).

A June feasibility study indicated that modernizing Britain's credit unions and helping the sector become financially sustainable would allow credit unions to help more than one million people by giving them access to banking products, debt advice and affordable loans, said the Department for Works and Pensions (FTAdviser.com April 18).

Currently about seven million people are trapped by payday lenders in high-interest credit, with some being charged more than 6,000% in interest on short-term loans.

Mark Lyonette, CEO of ABCUL, noted that centralizing and streamlining day-to-day tasks with modern access channels will make credit unions more attractive for many people. ABCUL said it aims for credit unions to attract up to one million more members by 2019 (Credit Today.com April 17).

The government estimated the expansion project could save consumers up to US$1.5 billion.

Texas Foundation Ready To Assist In Explosion Aftermath

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FARMERS BRANCH, Texas (4/19/13)--The Texas Credit Union Foundation (TCUF) is ready to help credit unions and their employees impacted by Wednesday night's explosion at a fertilizer plant in the town of West.  And a credit union in nearby Waco has begun accepting donations for the American Red Cross to assist victims.

GENCO FCU, one of 16 credit unions in Waco, which is about 20 miles from West, said on its website it is accepting donations at all of its branches for the citizens of West. The $238 million asset credit union established an account for the American Red Cross for monetary donations. It is also asking those with nonmonetary donations to drop the items off at branches in Lorena, Lacy Lakeview, Valley Mills Drive, and Woodway.

TCUF is assessing the situation to determine the scope of damage--if any--that credit unions and their staff might have experienced. If it is determined that the damage is widespread, TCUF will activate its disaster relief fund.

"In times of crisis, the foundation is here to help our credit unions and their staff get back on their feet so that they in turn can be there for their members," said TCUF Executive Director Courtney Moran Thursday.

"Already I received countless e-mails and phone calls from credit unions across the state wanting to know how they can help," said Moran.  "It's so gratifying to know that we serve in a movement where people really care about each other."

According to news reports, a massive explosion at a fertilizer plant devastated West, north of Waco, causing multiple casualties and leaving people trapped and buildings on fire.  Officials have said more than 160 people had been treated for injuries at various hospitals. The number of dead was still unconfirmed as of News Now's press deadline.  Emergency personnel continued to search for survivors Thursday from the explosion.

West is a town of 2,800 people, according to the Waco Tribune (April 18). Gov. Rick Perry declared McLennan County a disaster area, saying that the tragedy has hit about every family in the town. Seventy homes were damaged, as well as a number of businesses.  The blast was felt 50 miles away, said CNN.   

TCUF said it will notify credit unions if its disaster relief fund is activated.

Maine CUs Helped Thousands Stay Warm, On Budget

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PORTLAND, Maine (4/19/13)--Helping Maine's consumers afford to heat their homes in a rising-price environment has become an annual part of operations for many credit unions in the state, says the Maine Credit Union League.

During the 2011-2012 heating season, more than two-thirds of Maine's credit unions, looking out for their members' best interest, offered some kind of special heating and/or fuel loan to members. Combined, they offered more than $5 million in loans designated to help members heat their homes this past winter.

The average rate on the loans was 4.1% annual percentage rate. Some credit unions offered 0% financing for loans for heating oil.

"The rise in energy prices continues to challenge thousands of Maine consumers, and credit unions are doing all that we can to help so consumers do not have to choose between other essentials and staying warm," said John Murphy, league president.

The assistance underscores the value of credit unions' focus on their members in terms of service excellence, said the Credit Union National Association, which is urging credit unions to Unite for Good in achieving a strategic vision where Americans choose credit unions as their best financial partner. Fostering service excellence is one of three broad goals being advanced in realizing the vision. Removing barriers and raising awareness are the other two goals. Consumers can find more information about credit unions at aSmarterChoice.org.

On Feb. 21, Maine energy officials in Augusta noted the statewide average cash price for No. 2 heating oil was $3.85 per gallon, up two cents from the previous week (Associated Press via Yahoo! News). The average kerosene price also increased two cents to $4.32 per gallon, and propane rose four cents, to $2.78 a gallon. The government's Energy Information Administration attributed the increase to a significant increase in crude oil prices, coupled with unexpected refinery outages in January.

On April 9, the publications reported that the cost of  oil rose above $94 a barrel, an increase of 84 cents per barrel. Oil was up $1.50 in two days, or $2 a barrel from the forecast issued in March.