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Ohios Stretch-Pay a result of collaboration with students

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DAYTON, Ohio (5/2/11)--Ohio credit unions' Stretch-Pay short-term loan program is featured as a solution to quick-fix and expensive payday lending schemes in Alive Magazine's Spring issue. The article touts the benefits of the program and tells how it got off the ground. Local credit unions in the Dayton, Ohio area--Day Air CU of Kettering and Wright-Patt CU of Fairborn--piloted the program after a group of persistent students in a management class at the University of Dayton (UD) were asked to develop workable alternatives to the cash stores. The course instructor, Brother Victor Forlani, Marianist-in-residence at the university's School of Business, worked with the Fitz Center for Leadership in Community at UD. Eight years ago a city councilman had requested the center and UD look at the payday lending problem in the area. "We thought credit unions might offer a potential solution because of their nonprofit business model," he said. The credit unions expressed an interest but wanted the students to develop a workable business plan. After several proposals, the students came up with the idea of targeting people who were tempted to take out loans but who were also potential credit union members--thus creating a new line of business, instead of a new business. The article also talks about the impact the loans have made--in 2009, credit unions made more than 86,000 Stretch Pay loans and borrowers developed healthy financial habits.

Cyber crooks hit businesses with CU accounts

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WASHINGTON (5/2/11)--A new trend in international cyber crime is targeting businesses that have accounts at credit unions and small community banks, said the Federal Bureau of Investigation (FBI). The scheme uses compromised online banking credentials of small to medium-sized U.S. businesses to send unauthorized wire transfers to apparently legitimately licensed economic and trade companies in Heilongjiang province, a remote region of China near the Russian border (CNN Wire and Life is a Highway April 29). The crooks have successfully stolen at least $11 million, although the attempted fraud amount is about $20 million, according to the FBI's Internet Crime Complaint Center. The targeted businesses generally have accounts at local community banks and credit unions, some of which use third-party providers for online banking services. The crooks gain access through compromising the computer of an unsuspecting company employee. The FBI identified 20 incidents between March 2010 and April 2011 using the scheme.

CUs pick up the pieces in tornadoes aftermath

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MADISON, Wis. (5/2/11)--Credit unions in several Southern states have either begun to pick up the pieces from last week's swarm of tornados and flooding or are standing ready to help. So far, no significant new damage was reported Friday by credit unions in Alabama, which bore the brunt of the damage and deaths. But employees of a number of credit unions there have experienced damage to their homes. "We have reached all of the credit unions in Alabama," said Mike Bridges, vice president of marketing and communications at the League of Southeastern Credit Unions (LSCU). "While most are not affected, of the new ones we contacted, very few have had any problems. Many are seeing the power come back on in certain areas, but a few are continuing to keep branches closed until the power is restored," he said Friday. A day earlier, the league had reported that two credit unions sustained major damage. "We have been helping Community CU of Gadsden and Druid City Hospital (DCH) CU of Tuscaloosa secure mobile branches so they can continue operations," Bridges told News Now. "Pen Air FCU in Pensacola is lending its mobile branch to Community, since it completely lost its Rainsville branch, while DCH has tree damage to its facility and Alabama CU is loaning its mobile branch. "Right now we are still working to assess the needs of credit unions such as generators and things like that. As you would imagine, there are many stories of those affected. A few employees of various credit unions have sustained personal damage," Bridges said. Shared-branching, which proved itself during Hurricane Katrina, also saved the day in Alabama and other states. Credit Union Service Centers (CUSC) has 118 locations in Alabama, and "nearly all were open following the storm," said a press release. It said its shared branching services saved business. "Many credit unions struggled to keep branches open with power being out to nearly 400,000 residents. Shared branching locations allowed those affected by the storms to continue delivering services to members." "While shared branching is extremely convenient to members for routine access to their credit union, members in hard hit areas of Alabama are realizing the benefit shared branching offers during times of disaster," said CUSC Board Chairman Patrick La Pine. "The network also benefits members that are displaced or needing to travel during this difficult time." Many credit unions alerted their members to shared branching locations. DCH CU--just one of a number of examples--redirected its members in Tuscaloosa, Birmingham, and North Alabama to credit unions within the shared branching network and helped them to use surrounding outlet locations for their access. Websites also provided key communication to both members and employees, and enabled some to share stories and offer assistance or tell who needed help. The website of Alabama CU, Tuscaloosa, informed members it is offering 0% annual percentage rate (APR) disaster loans up to $1,000, with the first payment due in 45 days and repayment up to 120 days. It announced its "rolling branch" outfitted with a branch lobby and an ATM would be at Cullman office Friday to assist members needing cash and service. The Cullman area had been without electricity since Wednesday. And it gave updates on which branches were closed and which were operating with regular business hours. It said several branches would not open "until further notice." Alabama CU also gave information about employers posting payrolls and offered to use payroll data provided on the last payroll and credit them in advance of receiving payment from the employers "in an effort to assist, as much as possible, persons affected by Wednesday afternoon's damaging storms." The site also served as a message center for employees. They shared who is accounted for, who is displaced, who needs help, who is offering to truck in supplies, and how members were grateful for the credit union's help. "Offices that were able to open are reporting busy activity, and grateful members have said, 'Now's when we need you.' One staffer said, "Every member has a story--for some, they've lost everything they had." A poignant example came from a staffer at the Fairhope branch who received a call from a mother who had received her debit card in the mail. She was on her way to pick up her son and his girlfriend, who lost everything in the tornado. The debit card was not yet activated. She had left with no cash. She asked if the credit union could rush the card activation "so that it will work for me now. I have to get gas." The staffer got in touch with member care, got back with the member and told her to "stay on the phone with me while she tried her card and made sure it worked." The member was grateful. It "made me realize once again why I truly love working at Alabama Credit Union," the staffer said. Wider efforts of help will be available soon, said the league. LSCU is initiating its Disaster Relief Fund through its Southeastern Credit Union Foundation. "We are sending out the grant request documents and pledge form if any credit union would like to donate." It will have more information about the fund once it determines what physical needs, such as desks and computers, will be." It also is having discussions with the National Credit Union Foundation, and will provide more information once the league has visited the affected credit unions this week. (See related story, "CU disaster assistance activated for tornado areas" for an update.)

Maine league testifies on state TIL elder-abuse bills

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PORTLAND, Maine (5/2/11)--The Maine Credit Union League was in Augusta, Maine, Tuesday providing testimony at two state legislative public hearings. Of most interest to the league and Maine credit unions was LD 1338--which would incorporate federal Truth in Lending laws into Maine’s Consumer Credit Code. The league also is interested in a bill aimed at preventing elder abuse. LD 1338 would incorporate the TIL changes into Maine law in one step, rather than the piecemeal approach of the past, the league said (Weekly Update April 29). “We support the concept behind LD 1338, which would amend the Maine Truth in Lending Act (TILA) by adopting by reference federal TILA regulations,” said Quincy Hentzel, Maine league director of governmental affairs, testifying in support of LD 1338. “We support and prefer the approach of a wholesale adoption of federal Truth in Lending and implementing regulations which would then become Maine law. This approach would minimize, if not eliminate, our state-chartered institutions’ biggest challenge, which is the delay between federal law being enacted and the adoption of comparable state law and regulations.” Hentzel said the hearing went as anticipated, and the Insurance and Financial Services Committee directed that a stakeholders group, which includes Maine credit union representatives, be formed to try to come to an agreement. The stakeholders group is meeting today. The league also testified in support of LD 1374, which would expand protections--including financial activity--for victims of elder abuse. The league’s testimony highlighted the proactive approach the league and its credit unions have taken through the years to help identify and prevent finance abuse of elder and dependent members.

CU System briefs (04/29/2011)

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* STATE COLLEGE, Pa. (5/2/11)--A former manager at State College (Pa.) FCU has been charged with embezzling more than $67,000 from the credit union over a five-year span. According to court documents, Anne Martin, 42, allegedly approved unauthorized raises and pension contributions totaling $45,127 and engaged in $9,000 worth vacation abuse. A court hearing is scheduled in July ( April 28) … * ST. LOUIS (5/2/11)--Vantage CU hosted Willie Ahli, a credit union
delegate from Ghana, during the week of April 13-21 at the credit union's Bridgeton, Mo., headquarters. Ahli is deputy general manager, finance and administration, at the Ghana Cooperative Credit Union Association. He traveled to Madison, Wis., to attend a Credit Union Development Education (DE) training program, whose 2011 graduating class included two from Ghana participating through the African DE Scholars Program. During his St. Louis visit, he toured several Vantage CU branches, and spent a day at St. Louis Community CU and half a day at the Missouri Credit Union Association. He also shared his experiences with students at East St. Louis High School. From left are Vantage board President Dr. Jerry Eichholz, Ahli, and Vantage President/CEO Hubert Hoosman Jr. (Photo provided by Vantage CU) … * BURLINGTON, Vt. (5/2/11)--Mark Sievewright, who will be a speaker at the Association of Vermont Credit Unions Annual Meeting, has been named president of Fiserv's Credit Union Solutions division, effective at the end of May (Newslines Express April 29). He served for the past six years as Fiserv's senior vice president of the credit union division. Last year Sievewright received the Ambassador Award from the World Council of Credit Unions for his long-term contributions to the industry. He also has held positions as CEO of the Tower Group, president of Payment Systems Inc., and senior positions at HSBC and MasterCard International. Sievewright will succeed Scott Butler ...

Ga. SW Bridge corporates merger app submitted to NCUA

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DULUTH, Ga. (5/2/11)--Georgia Corporate and Southwest Bridge Corporate submitted their merger application to the National Credit Union Administration’s (NCUA) Office of Corporate Credit Unions on Thursday.
Speaking before several hundred delegates at the Texas Credit Union League’s 77th Annual Meeting last week, Southwest Bridge Corporate CEO Diane Addington said Catalyst Corporate FCU will be structured to cover costs with its existing fee structure. (Photo provided by Texas Credit Union League)
The application includes the corporates’ strategic business and capital plan, which describes the business model for Catalyst Corporate FCU--the organization that will be created by the merger--and capitalization documents that were finalized in March. The corporates anticipate that the NCUA Board will vote on the merger at its scheduled July 21 meeting. The planned merger date is Aug. 1. Southwest’s Member Advisory Council’s executive committee recently selected, and the Georgia Corporate board approved, participants for the Governance Advisory Council to assist in identifying members for Catalyst Corporate’s new board, according to Southwest Bridge Corporate President/CEO Dianne Addington. Governance Advisory Council participants are: Randy Smith, CEO of Randolph Brooks FCU, San Antonio; Tim Adams, CEO of SPCO CU, Houston; and Willie Jacobs, CEO of White Sands FCU, Las Cruces, N.M. The council will meet in May to review a list of potential candidates, to be drawn from credit unions in the nine core states served by the corporate. Speaking before at the Texas Credit Union League’s 77th Annual Meeting last week, Addington said Catalyst will be a full-service corporate credit union structured to cover its costs with its existing fee structure. “Catalyst will have a high-coverage ratio,” she said, indicating that it will not need to rely heavily on interest income or higher fees. At the same time, Catalyst will maintain a risk-averse balance sheet with an emphasis on transparency, she said.

First Carolina Corp. tops minimum cap fund goal

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GREENSBORO, N.C. (5/2/11)--First Carolina Corporate CU raised $60.6 million as of Thursday through its Perpetual Contributed Capital (PCC) subscription offering. The amount exceeds the minimum goal set for the Corporate’s Capital Restoration Plan, which was submitted to the National Credit Union Administration (NCUA) in January. Board Chairman Scott Woods credits the progress of the corporate’s recapitalization to the quality of the plan. “The staff at First Carolina has worked tirelessly to present our members a comprehensive, well-thought-out plan on how to move the corporate ahead and succeed under the new regulatory environment,” said Woods, president/CEO of South Carolina FCU, North Charleston. First Carolina had set a target of raising $60 million to $75 million in PCC and has received confirmation from 134 member credit unions to-date that their recapitalizations were approved by their boards. Of the amount committed, $39.1 million represents new capital investments and $21.5 million signifies conversions of existing membership capital share deposits. “Given the PCC raised and our estimated average assets, we expect to be in full compliance with NCUA’s regulatory requirements for capital and net economic value well before the October 2011 deadline,” said David Brehmer, president/CEO of First Carolina. “It’s a strong sign that our members want First Carolina to be their corporate credit union into the future. We deeply appreciate credit unions’ support of our mission and recapitalization effort.” Brehmer says several credit unions will consider First Carolina’s plan in May. “We’re hopeful the PCC total will continue to grow as additional credit unions hold board meetings to discuss our plan,” he said. Based in Greensboro, N.C, First Carolina Corporate CU is a $1.7 billion corporate serving credit unions in four states.

Survey CUs biggest challenge--attracting new members

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TALLAHASSEE, Fla. (5/2/11)--A majority (61%) of credit union industry leaders cited attracting new members as the greatest challenge affecting credit unions, after concerns over the U.S.’s economic climate declined, according to a recent industry survey by Credit Union 24, a deposit-taking ATM and point- of-service (POS) credit union service organization. Credit Union 24 announced the results of the industry survey conducted before and during the Credit Union National Association’s Governmental Affairs Conference this year.
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In 2010, attracting new members took second place to concerns about the economic climate. The second-greatest challenge facing the industry in 2011 is the uncertainty caused by the financial reform legislation at 53% (see Figure No. 1 to the right). Less than half (44%, compared with 70% in 2010) of leaders surveyed see the economy as a threat, rendering it the third-greatest overall challenge facing credit unions in 2011. For the third consecutive year, polled credit union leaders cited consumer misunderstanding of credit union benefits over banks as the greatest challenge in attracting new members. About 66% cited this as the greatest challenge, compared to 77% and 67% in 2010 and 2009, respectively (see Figure No. 2 below).
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The perception that credit unions have limited offerings compared with banks follows as the second greatest challenge in wooing new members for the third year in a row, with 52% of those polled--a seven point increase from 2010. “Results of our survey show that credit union leaders are feeling similarly to how they did in 2009; however, it also illustrates that credit unions are continuing to face the same challenges that have plagued our industry for many years,” said Jim Park, president/CEO of Credit Union 24. “This year’s financial reform legislation has understandably caused tremendous uncertainty among credit union leaders--and electronic funds transfer networks--as no one really knows the full effects of the legislation,” he added. “The challenge lies in analyzing the 'what-if' scenarios and developing contingency plans to address the legislation while continuing to remain focused on our industry’s core mission of delivering superior customer service to credit union members.” Also, 84% of credit union leaders surveyed cited that their credit union’s membership has either increased (45%) or remained steady (39%) year-over-year. This is a slight decline compared to 2010’s findings when 85% of industry leaders cited an increase (56%) or neutral (29%) movement in membership. The number of credit unions noting a decrease in membership grew 2% year-over-year to 17%, compared with 15% in 2010. For the second consecutive year, credit union leaders polled cited better customer service as credit unions’ strongest competitive advantage over banks; however, the percentage decreased by 12%. More lenders polled said that member ownership--a major hallmark of the credit union industry--is an increasingly important advantage over banks. Ownership nearly doubled in ranking to 21% in 2011 from 11% in 2010. Also for the second year, credit unions leaders said lower interest rates on loan products is the second strongest competitive advantage over banks. Lower rates grew in importance by 6% this year to 28%, from 22% in 2010. “For the third year in a row, more than half of industry leaders [surveyed] feel that credit union-owned service providers do a better job of serving credit unions. This sentiment is increasingly permeating our country and our industry,” he added. Member behavior has continued to evolve since 2010. 2011 saw a slower increase in members using point-of-sale (POS) and a more steady use of POS, at 54% compared with 45% in 2010. This is the first year that credit union leaders saw a decline in POS use among their membership. Other trends:
* ATM usage in 2011 has slowed; * The increase in ATM usage has continued to slow down and remain at a steadier pace; * The ongoing decline of ATM use has slowed as well; and * Fewer credit union leaders saw a decrease in ATM usage this year (5%) than last year (7%).
From the slower-than-last-year increase in POS, “we can infer that, given the economic climate and the national financial trends in consumer behavior, consumers have moved more towards cash transactions,” Park said. “While this is not a bad thing, it was a major focus of credit unions last year--as illustrated by survey data--to move members more towards cash-back at the point of sale, as this generates interchange income compared to an ATM transaction cost,” he added. “While the financial reform legislation has caused much uncertainty, the more that credit unions can continue to drive members to increase income-generating behaviors, the more it will benefit credit unions in the long term.”

SECU helps 53000 members get 82M plus in refunds

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RALEIGH, N.C. (5/2/11)--State Employees’ Credit Union (SECU) helped nearly 53,000 members claim more than $82 million in refunds while saving them roughly $7.9 million in fees during the 2011 tax season. This is the fourth year SECU has assisted members with tax preparation. Through its participation in the Internal Revenue Service free Volunteer Income Tax Assistance (VITA) program, the credit union increased the number of members helped by more than 35% to nearly 48,000, from 35,000 in 2010. VITA is an IRS program that helps low- and moderate-income taxpayers complete their annual tax returns at no cost. Credit unions and community organizations receive IRS-provided training in the preparation of basic tax returns and establishment of tax preparation sites. In only its second year of offering a low-cost tax preparation service for members who are above the income threshold for VITA, SECU more than doubled the number assisted, increasing to nearly 5,000 from the 2,100 figure of last season. A main focus of SECU’s tax preparation services is to ensure that participating members benefit from all tax credits for which they qualify--credits that often go unclaimed by those eligible, such as the Earned Income Tax Credit (EITC). This season, SECU helped members claim more than $35 million in tax credits, including $20.8 million in EITCs. SECU, based in Raleigh, N.C., has $22.5 billion in assets.

WOCCU to recognize international DE candidates

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MADISON, Wis. (5/2/11)--World Council of Credit Unions (WOCCU), in partnership with six Credit Union Development Educator (CUDE) programs, will recognize the third class of International DE (I-CUDE) designees at WOCCU’s 2011 World Credit Union Conference, July 24-27 in Glasgow, Scotland. David Marquez, general manager of COPOS Credit Union Co-operative Society, Port of Spain, Trinidad, intends to be one of the first Caribbean candidates to receive the certification. Marquez, who in 2007 earned his CUDE designation from the U.S. program, was one of the first to enroll in the Caribbean’s new CaribeDE program this past year. He’s attended WOCCU conferences in Dublin and Calgary. His work on his country’s WOCCU partnership with the Credit Union League of Connecticut as his independent study project, has completed the basic I-CUDE requirements. International candidates must complete four steps to achieve an international DE designation:
* Build a solid foundation by completing their local DE programs; * Complete an independent studies project approved by the International DE Council; * Participate in a WOCCU Engagement Tour Program, another country’s DE program or an equivalent international program approved by the International DE Council; and * Attend WOCCU’s World Credit Union Conference.
“Philosophy is good business,” said Pete Crear, WOCCU president/ CEO. “Each of these six DE programs has expanded the reach of our business and fostered credit union growth through cooperative philosophy. We hope to multiply that impact by facilitating the programs working together at an international level.” The six national groups represented at Glasgow will establish I-CUDE guidelines and growth strategies, include DE programs in Asia, Australia, the Caribbean, Europe, the Philippines and the U.S. Persons holding local DE certification interested in applying for international certification can contact:
* Asia--Ranjith Hettiarachchi, CEO, Association of Asian Confederation of Credit Unions, Thailand; * Australia--Peter Mason, Credit Union Foundation Australia; * The Caribbean--Melvin Edwards, past WOCCU chair, West Indies; * Europe--WOCCU Director Marlene Shiels, chief executive, Capital CU Ltd., Scotland; * The Philippines--Audie Joseph “Dudz” Samson, CEO, Visayas Cooperative Development Center, Philippines; and * The U.S.--Christopher Morris or Lois Kitsch, National CU Foundation.

Finances of Silver State Schools Arrowhead improve

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LAS VEGAS and SAN BERNARDINO, Calif. (5/2/11)--Arrowhead CU and Silver State Schools CU—two credit unions with recent financial troubles--are reporting improved operating results. Arrowhead CU, San Bernardino, Calif., posted net income of $3.9 million for the first quarter 2011 and increased its net worth to 3.91% of assets from 3.44% as of Dec. 31. Total assets at the end of the quarter were $700 million (Fontana Herald News April 29). Among the reasons for the improvements were reductions in operating expenses and improvement in loan quality, according to Arrowhead. National Credit Union Administration assumed control of Arrowhead June. The $876-million-asset credit union was placed into conservatorship due to declining financial condition News Now Dec. 12) Silver State Schools CU, Las Vegas, reported a $90,000 profit in the first quarter, reversing a string of nine quarterly losses ( April 29). The credit union lost $8.5 million in the first quarter of 2010. In 2008, Silver State Schools reported a record $10 million net income from operations but set aside $10 million in reserves for potential loan losses. During 2009, as property values continued to decline and record numbers of members experienced reduced income, the credit union recorded $8.1 million net income from operations. However, it set aside $59 million to cover current and potential future loan losses (News Now April 30, 2010). In February 2010, the credit union received a capital infusion to bolster its general reserves from its private share insurer, American Share Insurance (ASI). Silver State Schools CU reported $29.7 million in net worth at the end of March, but that figure includes the $22 million subordinated loan ASI made to the credit union in 2010.

Louisiana league announces new board

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HARAHAN, La. (4/29/11)--The Louisiana Credit Union League held elections for the league's board of directors during chapter meetings throughout the state (eNews April 27). Elected to the 2011-2013 board were:
* Virgil Allen, Tangipahoa Parish Teachers CU, Amite; * Joe Battaglia, Homeland FCU, Metairie; * Glen Beard, Alexandria (La.) Municipal Employees CU; * Joyce Butler, Carter FCU, Springhill; * Ray Chavanne, McNeese FCU, Lake Charles; * Tom Conner, Southwest Louisiana CU, Lake Charles; * Eldridge Etienne, Southern Teachers & Parents FCU, Baton Rouge; * Kathi Gill, Neighbors FCU, Baton Rouge; * Connie Kennelly, Tulane-Loyola FCU, New Orleans; * Bobbie Major Jr., Homeland FCU; * Ginger Manint, Eagle Louisiana FCU, Baton Rouge; * Benny Miers, Post Office Employees FCU, Shreveport; * Patricia Morris, Monroe Telco FCU, Monroe; * Vicki O'Brien, Jefferson Parish Employees FCU, Harahan; * Sidney Parfait, Post Office Employees CU, Metairie; * Connie Roy, Lafayette Schools FCU, Lafayette; * Cindy Sansing, Cenla FCU, Alexandria; * Anna Trahan, Section 705 FCU, Lafayette; * Donna Wagoner, Ouachita Valley FCU, West Monroe; and * Roy Walling, Barksdale FCU, Bossier City.
Each director is elected to a two-year term.

IBankrateI IFox BusinessI ask Are You a Good Fit for a CU

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NEW YORK (4/29/11)--A look by at consumers who routinely join credit unions--which was picked up by Fox (April 27)--shines a spotlight on credit unions in five situations. The article, "Are You a Good Fit for a Credit Union?" outlines five groups of consumers "who routinely join credit unions" and shows the benefits for each:
* College students who learn about finances at the credit union. John Iglesias, CEO of Salal CU, Seattle, and Shay Olivarria, author of "10 Things College Students Need to Know About Money,"point out that students don't always get the best deal from a bank. Credit unions focus on financial education and provide college students with a support system for learning about money. * Consumers worried about high fees. Bill Cheney, president/CEO of the Credit Union National Association, points out in the article that 80% of credit unions offer checking accounts with no minimum balance and mistakes cost consumers less at credit unions. On insufficient-fund fees, banks charge about $10 more on average than credit unions. * Credit card holders. Card customers who opt for bank-issued cards are likely paying more than they would at a credit union, said Daniel Penrod, senior industry analyst at the California and Nevada Credit Union Leagues. Credit union card rates are a percentage point lower than banks' rates. * Prospective borrowers. Although mortgage lenders offer similar rates and products, credit unions service their own loans, said Penrod. If something goes wrong, the borrower has a better chance working with a lender whose servicing is local. * Worried about big banks. A California songwriter says she switched to a credit union for "political" reasons, citing concern about large banks' role in the 2008 financial crisis. With a credit union, her money stays in her hometown and gets loaned to "people like me."
The article also interviewed Todd Pietzsch, public relations manager at BECU in Seattle, about banks' high fees and Bill Stavros, vice president of marketing at Proponent FCU, Nutley, N.J., about how credit unions appeal to politically conscious consumers.

Alabama CUs damaged in Wednesdays tornadoes

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MADISON, Wis. (4/29/11)--Alabama's credit unions and members took a direct hit from Wednesday's tornados, part of a storm front that spawned more than 155 tornadoes in six states. Although assessments of their situation were just beginning Thursday, already credit unions were reporting damages and deaths. Deaths totaled 263 and were climbing, with 162 reported in Alabama, including several credit union employees' loved ones; 33 in Tennessee; 32 in Mississippi, including two members of a credit union there; 14 in Georgia; and 11 each in Arkansas and Virginia ( April 28). (For a related report outlining the impact in the other states, see "In Mississippi, CU members killed in tornado" in today's System section.) Agility Recovery, CUNA Strategic Services provider, reported it is responding to 15 disaster declarations and has more than 200 members on alert across five states. "The Storm Prediction Center reported 155 tornadoes across the U.S. on Wednesday. This sets a new record for April tornadoes, bringing the total to over 800," said Agility. Although reports are still in the early stages, two Alabama credit unions reported the most physical damage--Gadsden-based Community CU, which lost its Rainsville branch, and DCH CU, Tuscaloosa, according to Mike Bridges, vice president of marketing and communications, at the League of Southeastern Credit Unions (LSCU), which serves Florida and Alabama credit unions. DCH CU "had roof damage and cars in the parking lot had windows blown out," he added. "Many credit unions are still without power. Many are working on generators or just not open. As you would imagine, many members have been affected, and a few credit union employees have lost loved ones," Bridges said. "The league is reaching out to every affiliated and non-affiliated credit union to assess their needs. We are also letting credit unions know about the Disaster Relief Fund available through the Southeastern Credit Union Foundation. It’s still early, but we’re attempting to reach out to all of the credit unions in Alabama," he said. The league's Birmingham office was closed Thursday, with no power or no phone service at the office. Power was just restored around 1p.m. ET. "The area around the office is still treacherous," Bridges added, noting the Birmingham office would be open today. A staffer at the Birmingham office told the Credit Union National Association, "We are in full disaster recovery mode right now, trying to get with all the credit unions. It's tough when they don't have power or phones either. Yesterday was unlike anything I have ever seen…it's just almost unreal." By the end of Thursday, the league had made contact with about 60% of credit unions in Alabama. CUNA Mutual's Credit Union Protection Disaster Team was also receiving reports on damage to credit unions from Wednesday night's storms, said Rick Uhlmann, CUNA Mutual's senior manager, media relations. "Disaster team members have been in contact with the leagues in Alabama, Tennessee, Mississippi, Georgia and Virginia. The leagues have reported a few credit unions sustained minor damage and there are reports of more substantial damage at two credit unions in Alabama," he said Thursday morning. Also, "CUNA Mutual's Credit Union Protection Disaster Team is in the process of reaching out to those credit unions we feel were most at risk. With power and phones out in many areas, this will take time. For those identified at risk, who we cannot reach by phone, we will have the catastrophe adjusters in their areas making direct contact with the credit unions," Ullman said. By the end of the business day Thursday, said Ullman, "the Credit Union Protection Disaster Claims Team has contacted all impacted leagues, CUNA Mutual field staff members, and many of the credit unions that are located across the path of Wednesday night's storms." One credit union suffered a major loss. "As rescue and clean-up operations continue and authorities open up closed areas, more damage to credit unions may be identified," he said. Even if they weren't damaged, many credit unions were closed in Tuscaloosa. Alabama Credit Union reported delayed openings at its main office and eight other locations. Its Mercedes offices "will be closed until further notice," the credit union noted on its website. America's First FCU said on its site that six of its 18 branches were "closed due to power outages" on Thursday. Alabama Telco CU said its branches in Madison and Hueytown were closed Thursday. Alabama Central CU noted that "due to widespread power outages, the Tuscaloosa and Decatur branches will be closed" Thursday and today. Members could access their accounts through the Shared Branching Network.

In Mississippi CU members killed in tornado

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MADISON, Wis. (4/29/11)--Although Alabama was hardest hit by the tornado system that wreaked havoc on Wednesday, several Southern states in the path of the system reported their credit unions were lucky--few reported damages. However, their members had losses, and one credit union in Mississippi report the deaths of two members, a couple. Mississippi endured two days of constant, brutal winds accompanied by sporadic and often wide-spread outbreaks of severe storms, said the Mississippi Credit Union Association, based in Jackson. “Association staff kept live weather reports and radar on at the office and home to monitor the situation,” Amy Manley, association corporate relations manager, told News Now. “We followed up with credit unions in areas we knew to be affected by the most severe weather. No Mississippi credit union reported damage.” The association contacted its credit unions and received some reports:
* Central Sunbelt FCU, Laurel, Miss., learned that a married couple who were members of the credit union were killed in the tornado that spun through Smith and Jasper counties. * Two credit unions in northeast Mississippi--Northeast Mississippi Health Services EFCU, Tupelo, and AMPOT FCU, Hamilton--reported members with “tremendous loss, both homes and family members,” from the Smithville area. The tiny rural town of Smithville, Monroe County, with a population of only about 900, was devastated by the storm and has an unconfirmed death toll of more than 10 people.
The Mississippi Emergency Management Agency received initial reports of damages from 48 of the 82 counties statewide and the Mississippi Band of Choctaw Indians. There are 32 confirmed fatalities in Mississippi at this time. As of press time, no information was received by News Now from the Tennessee Credit Union League or credit unions in that state. Media reports indicate 33 confirmed fatalities in Tennessee so far, due to the tornadoes. News Now also checked in with leagues in Virginia, Georgia, and Arkansas. Virginia credit unions reported no injuries, property damage or service disruptions, according Lewis Wood, vice president of public relations and communications for the Virginia Credit Union League. Virginia credit unions responding to News Now inquiries also reported no damages or injuries Virginia CU’s Farmville branch, located in one of the state’s areas hardest hit by tornadoes, was fully operational on Thursday. Chartway FCU, based in Virginia Beach City, also reported it was fully operational. Georgia Credit Union Affiliates (GCUA) reported that Georgia credit unions appear to have escaped major damages. “We checked in with our credit unions, and there were no branch closings,” said Anita Paul, director of communications for the GCUA. “We had reports of a few power outages that delayed openings, but overall Georgia credit unions appear to have been very fortunate.” In Arkansas, Reta Kahley, president/CEO of the Arkansas Credit Union League, reported to CUNA that credit unions there "were very lucky. We maintained power throughout the terrible storms. Cities north and west of us didn't fare so well, especially Vilonia. All my credit unions came through unscathed, but many members have lost their homes and belongings." For the reports on Alabama credit unions, see related story in System "Alabama CUs damaged in Wednesday's tornadoes."

CU System brief (04/28/2011)

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* MADISON, Wis. (4/29/11)--Matt Davis has been named director of innovation at the Filene Research Institute, effective May 23. Davis previously worked on helping credit unions build on the institute's i3 (Ideas, Innovation, Implementation) projects. He has been a Filene partner since 2007 as part of 30 under 30, and worked on a contract basis as an innovation implementation adviser in the fall of 2009. He also founded, which helped 250 credit unions launch Debt in Focus. Davis will work with Chief Innovation Officer Denise Gabel and the i3 program …

Western Bridge unveils its new name

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SAN DIMAS, Calif. (4/29/11)--Western Bridge Corporate FCU’s Charter Committee on Tuesday selected United Resources FCU as the new name to be submitted with the corporate’s chartering application to the National Credit Union Administration (NCUA) for approval. The name was selected from more than 70 submissions collected by the committee for consideration. “We wanted a name that reflected the unique advantages of the credit union model when members join together to share resources,” said Matt Davidson, chairman of the board of the future credit union. “It’s a simple reminder of why we want this new corporate.” Western Bridge Corporate FCU was created by NCUA in September to continue to provide correspondent services to credit union members of WesCorp.

CUNA Mutual Move on health care despite legal challenges

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AUSTIN, Texas (4/29/11)--Credit unions should proceed with changes required by the Health Reform Law despite the legal challenges the law faces, a CUNA Mutual employee benefits product manager told a Texas Credit Union League annual meeting audience Wednesday.
Click to view larger image CUNA Mutual Group’s Brad Pricer, senior manager of employee benefits product management, discusses the Health Care Reform Law with a breakout session audience Wednesday at the Texas Credit Union League Meeting and Expo in Austin, Texas. (Photo provided by CUNA Mutual Group)
Passed just over a year ago, the Health Care Reform Law mandated sweeping changes for health and welfare plans, said Brad Pricer, CUNA Mutual senior manager of employee benefits product management. But legal challenges have left some employers unsure how to proceed with those changes. A recent federal court decision in Florida found the law to be unconstitutional. “There are approximately 25 lawsuits filed by numerous states challenging the constitutionality of various provisions of the health care reform laws, creating much political discussion and an uncertain path for business owners and employees,” Pricer said. Despite the legal limbo, Pricer stressed that employers should begin or continue compliance efforts. “The decision in Florida clearly states that the health care reform laws are still in effect,” Pricer said. “It is important to understand that this decision is not settled as appeals are almost certain to take place.” Pricer highlighted some key provisions of the Health Care Reform Law scheduled to go into effect this year:
* Consumer rebates for excessive medical loss ratios are available; * Employers may optionally report health coverage costs on form W-2; * “Qualified medical expenses” now conform to a definition used for the itemized tax deduction; * Employees need a prescription to be reimbursed for over-the-counter medications/supplies through some health plans; * A Simple Cafeteria Plan is created to provide small businesses an easier way to sponsor a cafeteria plan; * Medicare Part D discounts are instituted; and * Grants for wellness programs are established.
With all of the required changes, many credit union human resource directors and their staffs are feeling overwhelmed with the complexities associated with understanding and accurately applying the new health-care reform laws, Pricer said. “They are being inundated daily with paperwork, forms, compliance mandates and deadlines and don’t feel they have ample time or manpower to manage it effectively,” he said. “But it’s a challenge you don’t have to take on alone.” CUNA Mutual has programs, products and resources to help navigate health care reform, Pricer said. These include:
* Online tools--timelines, legislative briefs, model notices and forms; * Answers and personal assistance from CUNA Mutual’s Employee Benefits Advocacy Center; and * Personalized consultation from employee-benefits professionals.

Texas CUs told Ask right questions on loan strategies

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AUSTIN, Texas (4/29/11)--Determining an appropriate lending strategy requires credit union leaders to ask themselves the right questions, based on their members’ needs and continually advancing technology, says CUNA Mutual Group.
Click to view larger image CUNA Mutual Group Sales Specialists Mark T. Nelson (left) and Robert Israelite speak to members of the Texas Credit Union League at their 77th annual convention and expo. (Photo provided by CUNA Mutual Group)
Evaluating considerations and presenting options were only part of what CUNA Mutual’s Robert Israelite and Mark Nelson shared with members of the Texas Credit Union League Thursday at the league’s 77th annual meeting and expo. Israelite, a sales specialist, told the workshop attendees to consider open-end and closed-end lending when developing their approach to lending. While both are legitimate lending options, they have different disclosures and documents, he said. “What you want your members’ lending experience to be will be one of the strategic questions to consider when deciding your lending approach,” Israelite said, adding that a one-size-fits-all approach is not right for all credit unions. While closed-end lending takes a traditional approach, open-end lending allows the process to be conducted remotely. The convenience and simplification can be a differentiator for members, said Nelson, also a sales specialist. Nelson added that progress in technology--Internet lending, electronic signatures and mobile lending--add to the opportunities available. “The advancements in mobile lending and electronic signatures will change the way your members borrow,” Nelson said. “Your credit union needs to be ready.” Because the lending landscape continues to change due to regulatory and technology influences, Israelite and Nelson recommended credit unions answer these questions when planning a lending approach:
* What does the credit union want its members’ lending experience to be? * What products does it offer? * How do members prefer to close loans? * What is the credit union’s position on remote lending channels? * Where does the credit union lend? Different states have different regulations. * How comfortable is staff with regulatory ambiguity? * Does the state allow electronic filing of titles? * How strong and competent is the credit union’s compliance support?
Nelson suggested credit unions engage their compliance and operational partners--data processor, document provider, legal adviser--and answer thought-provoking questions to determine their consumer-lending approach.

Report shares N.Y. CUs outreach efforts

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ALBANY, N.Y. (4/29/11)--The Credit Union Association of New York has released its 2010 MORE (Member Outreach and Reinvestment Endeavor) Report, an annual compilation of New York credit unions’ outreach efforts. This year’s edition features more than 900 entries from 80 credit unions representing all 14 association chapters. The report outlines credit union outreach efforts in adult financial education, community investment and outreach, customized products and services, financial counseling, immigrant outreach, Volunteer Income Tax Assistance and youth financial education. The 2010 MORE Report was shared with lawmakers during the association’s Governmental Affairs Conference to offer evidence of how credit unions fulfill their mission. A few of the stories documented in the report:
* Alternatives FCU, Ithaca, partnered with Tompkins County Chamber of Commerce to educate self-employed individuals and local small-business owners about health-care legislation changes and applicable credits. * CORE FCU, East Syracuse, underwrote, with assistance from a New York Credit Union Foundation grant, the second annual Teen Finance Forum at ESM High School. Students from 10 area high schools participated in the day-long financial literacy event. The credit union also continued operating a student-run branch at the school. * Union Settlement FCU, New York, as part of its monthly Money Smart seminar series, hosted a free Debt 911-Emergency Financial Relief seminar in both English and Spanish. The seminar covered topics such as the collection process, the dangers of debt-reduction agencies, consumer rights under the Fair Debt Collections Practices Act, the civil lawsuit process in New York State and the pros and cons of bankruptcy. Participants also were offered a free credit report, credit score and counseling session to improve their credit scores.
Also included in the report are the results from the 2010 More Report Survey. Among the survey findings:
* Nearly 60% of New York’s credit unions offered customized products for youth. * New York credit unions educated more than 65,000 of the state’s young people through financial education programs. * They provided training for more than 45,000 New York consumers at adult financial education sessions, 20,000 of whom were members of underserved communities; * More than 57% of New York’s credit unions partnered with other organizations. * They gave nearly $3 million to community organizations in 2010. * New York credit unions were involved in nearly 7,000 charities and community boards.

Space Coast sues brokers on investments sold to defunct CU

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NEW YORK (4/28/11)--A lawsuit filed by Space Coast CU Tuesday claims four Wall Street brokerage firms--including Barclays--sold risky collateral debt obligations (CDOs) that they knew would fail to Eastern Financial Florida CU, costing the latter credit union about $150 million and contributing to its collapse. Melbourne, Fla.-based Space Coast CU filed the suit in U.S. District Court for the Southern District of New York in Manhattan against Barclays Capital Inc., Barclays Bank PLC, State Street Global Advisors, State Street Bank and Trust Co., and State Street Corp. The $2.4 billion asset Eastern Financial Florida CU's lost $149.2 million in the CDOs. That precipitated its failure and eventual merger into Space Coast. The $3.17 billion asset Space Coast acquired its assets on June 30, 2009 (News Now May 4, 2010 and May 26, 2010). In the complaint documents filed with the court, Space Coast alleges that the action "concerns a large international bank swindling a Florida credit union by creating and selling an investment that was a mirror opposite of what it purported to be." The CDO, named Markov CDO I, "was built to fail," the complaint document said. Eastern Financial Florida CU, and all other investors in Markov, lost 100% of their investments. The complaint alleges four material misrepresentations, reinforced by marketing efforts, concerning the Markov, that misled the credit union as to:
* Who selected the collateral assets referenced in Markov; * The bases and methods used to select those collateral assets; * The credit quality of the assets; and * The protections Markov's structure was supposed to provide against losses experienced by the collateral assets.
Space Coast alleged that Barclays and the other defendants created or underwrote a CDO nearly opposite of the one represented. It was built to fail because within the CDO was a rigged bet in the form of a credit default swap (insurance policy) that would pay the defendants if the riskiest collateral assets referenced by Markov failed, Space Coast said. "What appeared to be solid AAA-rated assets were actually junk quality securities," said the complaint filed. It noted that $400 million raised through sales of the Markov notes to the credit union and other investors was reserved to pay off Barclays when the referenced collateral inevitably failed. "At bottom, this is a story of a bank that when faced with losses from subprime related investments, resorted to deception." The complaint termed that the facts surrounding the rigged bets built within the CDO "lay to rest any notions of chance and instead evince deliberate--indeed, malevolent--design." The complaint said the CDO in the case was "materially similar" to the "now infamous, built-to-fail Abacus CDO" sold by Goldman Sachs & Co. and which was the target of a probe by the Securities and Exchange Commission. In April 2010, Goldman settled the investigation for $550 million, the court documents said.

CU System briefs (04/27/2011)

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* TAMPA, Fla. (4/28/11)--The suspect in the Monday robbery of Tampa-based Grow Financial CU is in stable condition at a hospital after deputies shot him at his house while he was showing where the loot was kept. The suspect, Thomas Noettl, 30, had been apprehended at a local casino Monday night and taken to his home to recover the money stolen. Deputies said Noettl, whose hands were handcuffed in the front, grabbed a knife and wouldn't let it go. He sustained three gunshot wounds. The incident began when Noettl allegedly entered the credit union at 12:40 p.m. Monday, gave the teller a demand note and indicated he had a weapon. He fled in a Lexus. According to the sheriff's office, part of the money was recovered at the house ( and Associated Press Newswires April 26)… * ALBUQUERQUE, N.M. (4/28/11)--Estefanita "Fannie" Trujillo, long-time credit union activist, died Sunday at the age of 83, according to the Credit Union Association of New Mexico. She served many years as manager of Northern New Mexico Schools Employees FCU (NNMSEFCU) and as a board member at Guadalupe CU for 15 years. She worked at NNMSEFCU, beginning in 1969, when it was known as Sante Fe Public Schools FCU, until 1988. After her retirement, she continued to serve as a volunteer board member, said Larry Lujan, CEO of NNMSEFCU. In 1993, she was named to the New Mexico Credit Union League Hall of Fame. Trujillo's husband, brother-in-law and daughter-in-law also worked for credit unions. A Mass of Christian burial will be at Our Lady of Guadalupe today at 9:30 a.m., with burial in Santa Fe National Cemetery …

IUsNews.comI Why you need a CU account

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MADISON, Wis. (4/28/11)--Credit unions are better than commercial banks, primarily because credit unions work for the member/consumer, while banks work for their shareholders, according to a “My Money” columnist for In a Tuesday column, ‘Why You Need a Credit Union Account,” author Jim Wang said that while credit unions have been around for quite some time, it hasn’t been until the past few years that they have grown in popularity as consumers have become aware of the self-centered excesses of “too big to fail” commercial banks. Wang said that some of the other reasons that credit unions are better than banks are:
* Credit unions generally are smaller, which typically means better service. The fewer members/customers, the less likely each member/customer becomes an account number. When a financial institution gets to a certain size, everything gets reduced into a spreadsheet line item and it loses a bit of the human element. * They have better rates. Consumers can find some of the best certificate of deposit (CD) rates and car loan rates at a credit union. Banks make their money by borrowing cheaply--from deposit accounts such as CDs--and lending it for more--such as on mortgage and car loans. Credit union members--the ones depositing and borrowing money--are the beneficiaries of any profits. * Fees and minimum balances are usually lower. Most credit unions have share-draft accounts with low minimums and low or no fees. Without a profit motive, there’s little incentive to get people to deposit more to increase loan amounts. * Members can try to join the board. The board of directors at a credit union is made up of its members. * National Credit Union Administration insurance is as good as Federal Deposit Insurance Corp. insurance.
To read the column, use the link.

N.M. CU Foundation awards 114K in scholarships

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ALBUQUERQUE, N.M. (4/28/11)--The New Mexico Credit Union Education Foundation awarded $114,000 in scholarships to 114 students for the 2011-2012 school year. Each scholarship recipient was awarded $1,000. Applications from more than 400 students were received. Applicants must be New Mexico residents, full-time students and maintain a minimum grade-point average. The foundation is a scholarship program formed by special legislation through which credit unions use abandoned funds for educational or charitable purposes. Since it was established in 1992, the NMCUEF has presented 1,069 scholarships totaling $612,600 to students attending accredited vocational or technical schools, colleges or universities in New Mexico.

WOCCUS Pete Crear to retire

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MADISON, Wis. (4/28/11)--Pete Crear, president/CEO of the World Council of Credit Unions (WOCCU) since June 2005, has announced that he will retire from that post soon after WOCCU’s World Credit Union Conference in Glasgow, Scotland in July. “When I first began as a junior auditor with the Michigan Credit
Click to view larger image WOCCU President/CEO Pete Crear (shown here addressing an earlier conference) announced his upcoming retirement today, effective August.

Union League in 1965,” Crear noted in his departure statement, “I had no idea that I would one day find myself here” in the top position at WOCCU. “I am honored at the faith the board has shown in me over the years and humbled by the good work that we have been able to do as part of WOCCU’s mission of service.” His retirement is effective in August. WOCCU Chair Barry Jolette, who is also president/CEO of San Mateo CU in Redwood City, Calif., said the WOCCU board will immediately begin a search for its next president/CEO, though, he added, “We’ll never replace Pete…” Credit Union National Association resident/CEO Ill Cheney commended Crear on his time at WOCCU and said, “I have had the opportunity to work with Pete on a variety of projects for WOCCU over the years. I have found his leadership skills, insight, charm and encyclopedic knowledge of the movement to be the perfect mix for his role as president and CEO of the global credit union association. "He developed all of those qualities in a career spent bringing cooperative financial services to those who need them most--locally as a league president, nationally at CUNA, and internationally as WOCCU’s chief executive. It will be a challenge to replace him--and just as much of a challenge to imagine our movement without him.” WOCCU said in its release that during Crear’s tenure the organization has significantly expanded membership, as well as an increased influence in credit union development worldwide. WOCCU also launched development programs in Ethiopia, Haiti, Peru and other countries, as well as seeing its development program in Afghanistan grow significantly. Among many other innovations and accomplishments under Crear, WOCCU convened its first technical congresses to train credit union managers in Africa, Latin America and the South Pacific. WOCCU also launched the European Network of Credit Unions, the International Credit Union Regulators Network and the Global Women’s Leadership Network, a peer-to-peer and educational network that brings together women credit union leaders from both developed and developing countries. During his time at WOCCU, Crear was honored both nationally and internationally for his work to help strengthen the credit union system throughout the world. Prior to joining WOCCU, Crear was with the Credit Union National Association and served in the association’s Madison, Wis., office as executive vice president of external relations and, before that, executive vice president and chief operating officer responsible for daily operations. He also served in top leadership positions at the Indiana, Connecticut and Michigan credit union leagues. A special ceremony and other events honoring Crear’s achievements at WOCCU will be held at the World Credit Union Conference in Glasgow. Use the resource link for more information and to register.

S. Carolina league elects two to board new officers

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COLUMBIA, S.C. (4/28/11)--South Carolina credit unions elected one new director and re-elected another to the South Carolina Credit Union League (SCCUL) board of directors. Election results were announced at an April 16 business session of the SCCUL & Affiliates 2011 Annual Meeting in Myrtle Beach, S.C. New to the 2011-2012 SCCUL board is Anne Shivers, president/CEO of Carolina Collegiate FCU, Columbia. Re-elected is Rick Hammond, president/CEO of S.C. State CU, Columbia. Both will serve three-year terms. Continuing their multi-year terms in 2011-2012 are:
* Faye Crocker, CEO, Greater Abbeville (S.C.) FCU; * Robert Harris, CEO, Health Facilities FCU, Florence; * W. Ray Partain, board member, Anderson (S.C.) FCU; * Ed Templeton, president/CEO, SRP FCU, North Augusta; and * Linda Weatherford, director of marketing and business development, SPC CU, Hartsville.
Following the business session, the board named its officers:
* Weatherford, chairman; * Templeton, vice chairman; * Partain, treasurer; and * Crocker, secretary.
As immediate past chairman, Scott Wood, president/CEO of SC FCU, North Charleston, remains as an ex officio member of the board, as is SCCUL President/CEO Steve Fowler.

Filene seeks participants for two leadership studies

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MADISON, Wis. (4/28/11)--The Filene Research Institute is undertaking two studies to help credit unions understand and plan for leadership challenges. “Predicting Organizational Performance: The Role of the CEO, the Senior Management Team, and Work Engagement” will be conducted by Prof. Murray Barrick of Texas A&M University. The study seeks to identify personality traits and leadership styles of effective credit union CEOs and senior management teams. The findings will help credit unions identify and tap the potential of CEOs and staff to improve performance and service to members. “Key Attributes of Highly Successful Middle Managers” will be led by Michael Neill, president of Michael Neill & Associates. The study aims to identify key traits of successful operational managers to help credit unions understand, hire and promote those most likely to improve their performance. Filene seeks individuals from natural-person credit unions of all sizes to participate for free in the studies. The data participants contribute will remain private. Filene’s public report will present anonymous aggregate findings. To learn more or to sign up for the studies, use the links.

Study questions impact of homebuyer ed programs

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WASHINGTON (4/28/11)--Although there is no conclusive evidence, potential homeowners who take part in pre-purchase education and counseling programs may be more apt to pay their mortgages on time, according to a Mortgage Bankers Association (MBA) study released Tuesday. Those who participate in default counseling are more likely to have their loans modified, the study also indicated. The study, “Homeownership Education and Counseling: Do We Know What Works?” was conducted by Michael J. Collins and Collin O’Rourke of the PolicyLab Consulting Group--sponsored by MBA’s Research Institute for Housing America. It examines effectiveness of the leading types of pre-purchase and post-purchase counseling education. The consulting group concluded it did not know what effectively works. Key findings include:
* The study reviewed 18 evaluation studies and found that sample selection biases plague most of the studies. * Some pre-purchase programs reduced mortgage default by as much as 34%, but many studies found no such effects. * At least one study suggests programs may result in accelerated pre-payment of mortgages. * More than 2.1 million clients received one-on-one housing counseling from Housing and Urban Development (HUD)-approved agencies in fiscal year 2010, according to HUD reports. But the services delivered varied. About 245,000 received pre-purchase counseling; 205,000 received help with home repair or a reverse mortgage; 278,000 received help for rental housing; 37,000 received homelessness counseling; and 1.4 million received foreclosure prevention counseling. * Among clients attending pre-purchase education, about 17% reported purchasing a home and another 26% anticipated buying within three months. HUD data suggest counseling agencies were involved in more than 301,000 loan modifications in fiscal year 2010.
The study also makes recommendations for future studies on the effectiveness of the programs. To view the full report, use the link.

Savings challenge ends Sat. results due May 17

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MADISON, Wis. (4/28/11)--The National Youth Saving Challenge officially ends this Saturday. Credit unions are reminded to post their savings challenge results by noon May 17 CT to be eligible for 10 prize drawings of $100 each randomly awarded by the Credit Union National Association (CUNA). The National Youth Saving Challenge takes place every year during April. It is held in conjunction with National Credit Union Youth Week, sponsored by CUNA. Credit unions are asked to report the number of youth who made deposits, the number of new account opened, and the total dollars deposited by youth during the challenges. The starting and ending dates of the challenge is also requested. Credit Union Youth Week 2012 will be April 22-28.

Georgia storm closes five branches of Coosa Valley CU

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ROME, Ga. (4/28/11)--Storm damage in Rome, Ga., closed all five of Coosa Valley CU's locations Wednesday for the rest of the day. The main office in Rome remained without power late Wednesday morning, credit union branch manager Rick Baxter told the Cedartown Standard ( April 27). newspaper. That meant the $152 million asset credit union's server was down, and none of the locations could access member information. The power outage closed two locations in Rome, and one each in Cedartown, Armuchee and Cartersville. The locations were expected to be open today for normal business.

Texas league announces 10 rebate

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DALLAS (4/28/11)--The Texas Credit Union League (TCUL) will provide its member credit unions with a 10% dues rebate for 2011--a total of $550,000--the league announced at the close of its annual business meeting Tuesday in Austin., Texas.
Click to view larger image Credit Union Resources Inc. Chairman Paul Trylko presents a dividend check in the amount of $550,000 to Texas Credit Union League Chair Pamela Stephens at the league annual business meeting. On Tuesday, the league announced it would return the amount to its members as a 10% dues rebate. (Photo provided by Texas Credit Union League)
“It’s the right thing to do,” said league President/CEO Dick Ensweiler of this decision. Credit Union Resources Inc, a TCUL subsidiary, notified the board of directors in March of its intention to present the dividend to the league. At its March meeting, the board decided to return the money to its member credit unions. Annual meeting attendees offered applause when league Chair Pamela Stephens announced how the league would use the $550,000 check received from Credit Union Resources. "The credit union movement, not unlike any other industry, has dealt with its fair share of challenges,” Stephens said. “Returning dividends to our dues-paying members is our way of showing how much we appreciate their loyalty and commitment to this organization during the good times and the not-so-good times.”

Discovery breakouts debut at CUNAs ACUC

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MADISON, Wis. (4/28/11)--The Credit Union National Association (CUNA) and CUNA Mutual Group are collaborating to bring CUNA Mutual's Discovery breakout sessions for the first time to the 2011 America's Credit Union Conference & Expo (ACUC), June 19-22 in San Antonio, Texas. The 17 face-to-face sessions will address key industry topics credit unions have deemed important to running their businesses. They will feature some of the industry's top thought leaders and best practices at one of the credit union marketplace's most innovative and progressive conferences, the two groups said. "Collaboration is more important today than ever before in the credit union market," said Jeff Post, CUNA Mutual president/CEO. "Through this partnership, CUNA and CUNA Mutual are collectively demonstrating their commitment to serving and supporting the credit union movement. Discovery's diversified learning experience will help ACUC attendees solve problems, maximize opportunities and address current market challenges." The Discovery sessions will provide a forum to deliver thought leadership on trends and challenges facing credit unions. That information is provided through free webinars, a free virtual daylong conference and now through face-to-face sessions at CUNA's ACUC. "ACUC is consistently lauded for its innovative, forward-thinking agenda and unmatched speaker line-up," said Bill Cheney, CUNA president/CEO. "This year's event promises to be a one-of-a-kind experience." For more information on the Discovery sessions at ACUC and to register, use the link.

Parents talk to kids about sex drugs--but not money

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WILMINGTON, Del., and APPLETON, Wis. (4/27/11)--Nearly all (95%) parents say they're primarily accountable for their kids' financial education, but only 29% say they are "excellent" financial role models. In fact, says a new survey, parents would rather talk with their kids about sex and drugs than about money. The survey, conducted by ING DIRECT USA, a direct bank based in Wilmington, Del., noted that parents are on the front line of their children's financial education but they struggle to talk about money. Among the survey findings:
* Roughly 32% of parents are prepared to talk to their kids about drugs and alcohol; * About 28% of parents are prepared to talk about sex and dating with their children; and * About 26%t are prepared to talk with their kids about about money and finances.
Prospera CU, based in Appleton, Wis., offered some advice for parents in this situation in the Green Bay Press-Gazette (April 26). Parents should not feel uncomfortable talking to their kids about money. Instead, take the opportunity to show why saving can yield results, said Kristina Florez, Prospera's director of marketing, in the article. Parents can lead by example, she said. When making a trip to the credit union or bank, take the child along and talk about what you're doing. It helps kids understand the process of where the money is going and why, Flores added. If you're planning for a vacation, the kids can see why it takes time to save for it, she said. A trip to the store also can provide a learning opportunity. If a child wants something, the parent can offer to pay for part of the item, with the child paying for the rest. This makes children think about how they spend their money and whether the item is truly something they want or need, Flores told the newspaper. The ING DIRECT USA study also found that economic uncertainty may continue to impact parents' ability to be good role models. Parents are tapping their kids' savings to pay bills and debt. About 31% of parents have withdrawn or considered withdrawing money from their kids' savings to pay bills or pay off debt. And more than half (58%) are saving less for their child's future than they did two years ago. Roughly 46% have sacrificed contributions to their child's savings. The phone survey was conducted with 2,000 adults over 18 years old, with 627 indicating they were parents of a child under 18, said ING DIRECT.

Nebraska gov. approves savings promotion raffle bill

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LINCOLN, Neb. (4/27/11)--Nebraska Gov. Dave Heineman Tuesday approved a bill that would amend Nebraska Revised Statutes to allow the state's credit unions to conduct savings promotion raffles to provide members an incentive to save by offering a chance to win a prize or prizes. LB 524 was introduced by State Sen. Amanda McGill (LD-26) of Lincoln and passed by the Legislature April 20. It will go into effect in September. "The governor's approval of LB 524 means that Nebraska's 425,000 credit union members will have a fun and innovative way in which they can save money for their future," said Scott Sullivan, president/CEO of the Nebraska Credit Union League. "It's a win-win for members because they not only have a chance to win one or more prizes, but more important, they will have personal savings that has accumulated over time when it's all said and done," he added. "Credit unions focus their efforts on improving the financial lives of their member owners and LB 524 will serve as another tool to help in that effort," Sullivan said, adding, "We believe that LB 524 will incentivize folks to save who have never saved before and will lead to a habit of saving." The league will work with participating credit unions to roll out a program in 20-12. Other states with laws that allow for savings promotion raffles include Washington, Michigan, Rhode Island and Maine.

PULSE Issuers expect 73 drop in interchange revenue

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HOUSTON (4/27/11)--Small debit card issuers such as credit unions and community banks on average expect a 73% decrease in debit interchange revenue as a result of pending interchange fee rules, according to the 2011 Debit Issuer Study commissioned by PULSE, an electronic funds network. Although institutions with less than $10 billion in assets are exempt from the regulations proposed by the Federal Reserve Board under the Durbin Amendment in the Dodd-Frank Act, they are critical of the interchange cap and skeptical the exemption will be effective, according to PULSE, a Discover Financial Services company. "The study results support broad industry consensus that the proposed interchange cap will likely affect even exempt issuers," said Steve Sievert, senior vice president of PULSE. "However, the impact small issuers say they are expecting is greater than many anticipated," Sievert added. In the study, respondents said they expect, over time, interchange income to decrease due to marketplace pressures. Even if a network offered two-tier pricing, the market-conditions shift would eventually require the interchange rate for exempt institutions to be reduced, they said. Other findings:
* The proposed network exclusivity provisions are unnecessary given the interchange cap. *Almost all issuers preferred the alternative that would require two unaffiliated networks on each debit card, given that many are already compliant with that requirement. * An alternative requiring two network choices for each method of authorization--such as two for PIN and two for signature--would create major operational challenges without providing value to consumers, respondents said. * Issuers expect the interchange proposal to significantly impact their demand deposit account business. * Fifty-four percent of regulated institutions and 27% of exempt institutions said they are evaluating additional fees or reducing benefits. Exempt issuers are considering reducing rates on high-yield check accounts, eliminating ATM fee rebates and charging account holders for the service of having a checking account. Many are assessing debit rewards. * Many said they will encourage consumers to increase use of PIN debit instead of signature debit because PIN transactions will have a better bottom-line contribution for issuers.
"There is unanimous agreement among financial institutions we surveyed that the Durbin Amendment will adversely impact consumers," said Tony Hayes, Oliver Wyman partner and project leader of the study. "To recoup lost revenue, issuers will charge higher fees for banking services, reduce debit card benefits--such as rewards and zero liability protection--and introduce restrictions on how debit cards can be used." PULSE has commissioned the benchmark Debit Issuer Study for the past six years. The Credit Union National Association has urged Congress to stop and study the fed proposed rule's impact on credit unions and consumers.

Variety of CU activities aid kids hospitals

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MADISON, Wis. (4/27/11)--Credit unions nationwide are involved in fundraising activities for Children’s Miracle Network Hospitals through Credit Unions for Kids. Among the latest fundraiser events and sponsors: * The 2011 Northwest Credit Unions for Kids Wine Auction, which benefited Children’s Miracle Network Hospitals. It raised over $135,000 on April 15. Sponsors of the event included iQ CU, Vancouver, Wash.; Financial Service Centers Cooperative, Ontario, Calif.; and CO-OP Financial Services, Rancho Cucamonga Calif.; Allied Solutions, Carmel, Ind.; CUNA Mutual Group, Madison, Wis.; Northwest Credit Union Association, Beaverton, Ore.; OnPoint CU, Portland, Ore.; BECU, Tukwilla, Wash.; Columbia Community CU, Vancouver, Wash.; Boyce Financial Group, Vancouver, Wash.; and CU Direct Corporation, Ontario, Calif. * A breakfast meeting sponsored by the Pittsburgh Chapter of the Pennsylvania Credit Union Association on April 12 at UPMC Children’s Hospital of Pittsburgh. The Children’s Hospital of Pittsburgh Foundation provided the food and venue for the 30 attendees in appreciation of their fundraising efforts for the Children’s Miracle Network Hospitals. A two-year fundraising effort by credit unions in the chapter concluded in December and resulted in more than $30,000, of which $25,000 was earmarked for a distraction therapy room within the hospital. The Pittsburgh Chapter is now the sponsor of the pirate-themed therapy room. * Northwest FCU Foundation presented Children’s Miracle Network Hospitals with $6,000 in donations given by members and employees, at the kickoff for the annual Credit Union Cherry Blossom Ten Mile Run in Washington D.C. * Kohler (Wis.) CU’s Chain of Hearts campaign, which raised $3,200 in February. The money raised will support Children's Hospital of Wisconsin. The campaign raised funds through the sale of links and other employee-sponsored fundraisers. Kohler CU’s Chain of Hearts is part of a statewide fundraising effort of more than 300 credit unions. * The Million Pennies Campaign is sponsored by the Virginia Credit Union League’s (VACUL) Community Involvement Committee and its partner Credit Unions Care Foundation of Virginia to raise money for the hospitals. Belvoir FCU placed collection jars throughout its branches for members to donate pennies to help kids associated with CMN Hospitals. Through this effort, Belvoir FCU contributed nearly $500. * The Minnesota Credit Union Foundation’s Credit Unions for Kids Committee, which raised more than $168,000 for Gillette Children’s Specialty Healthcare in 2010. Throughout 2010, the volunteer committee coordinated a variety of large- and small-scale fundraisers for credit unions and members statewide.

Federation CDCUs to expand service to older adults

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NEW YORK (4/27/11)--The National Federation of Community Development Credit Unions has received a major grant from The Atlantic Philanthropies to pilot a nationwide program to help low-income seniors gain financial security. The Atlantic Philanthropies is a foundation that works to put in place policies and programs that will create long-term benefits for disadvantaged populations. Eight U.S. community development credit unions (CDCUs)--credit unions with a specific mission of serving low- and moderate-income communities nationwide--will receive funding to reach out to older adults struggling with debt and limited resources. Savings programs, low-interest loans, consumer counseling and debt-reduction plans will be offered as the “Creating a Path to Economic Security” campaign goes into action. Participating CDCUs will partner with the National Council on Aging (NCOA) and its nationwide network of Economic Security Service Centers, and other organizations that provide one-on-one counseling to help seniors regain their economic footing. “The Atlantic Philanthropies recognizes the value of credit unions to their communities,” explained federation President/CEO Clifford N. Rosenthal. “Their generous grant will allow us to help CDCUs serve older members in their communities who may be at risk of slipping further into poverty, but may not know there are resources available to help them. “Many credit unions already offer competitive loan and savings rates, as well as free checking accounts to their members,” Rosenthal added. “Through this program, we’ll help the credit unions chosen for the pilot to tailor their services to low-income seniors and those approaching retirement age, as well as help these institutions get the word out to other older adults who may never have realized now beneficial a credit union could be for them.” The federation and the selected CDCUs also will collaborate with several national organizations working with older adults in implementing the campaign and in disseminating information gleaned from it, including NCOA, the National Disability Institute and others.

Deadline June 30 to apply for NCUF fin ed grants

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MADISON, Wis. (4/27/11)--June 30 is the deadline for credit union organizations to apply for new Financial Education Grants from the National Credit Union Foundation (NCUF). NCUF’s annual grants, formerly known as “Innovation Grants,” have been renamed to reflect the foundation’s new focus on financial education. The grants continue to be aligned with REAL Solutions, NCUF’s signature program. REAL Solutions strives to improve the financial capability of American families, including low-wealth individuals and families and young adults and children. Financial education and literacy programs from REAL Solutions are designed to increase family financial capability through access to information, training opportunities and coaching. NCUF said research shows that the low-wealth market includes not only lower-income consumers, but also consumers with moderate and middle incomes who have been unable to build significant savings or assets. REAL Solutions aims to help these consumers become credit union members, grow savings and accumulate assets that will generate wealth for their families. New Financial Education Grants can assist credit union organizations participating in these programs, or other initiatives consistent with the financial education components of REAL Solutions. They are:
* Providing financial counseling; * Building employee and member financial capacity through savings challenges and other wealth coaching programs; and * Creating experiential learning programs, such as reality fairs and poverty simulations, after-school financial education programs, product awareness and staff training.
Organizations eligible to apply include credit unions, credit union service organizations, state credit union associations and foundations and any other organizations owned or controlled by credit unions. The amount of grant dollars available depends on how much credit union organizations invest in the Community Investment Fund (CIF). With interest rates at record lows this year, NCUF will need to receive funds from more supporters and CIF investors to grant at least $300,000. Each quarter, half of the CIF dividends is returned to investing credit unions. The other half is donated to NCUF, which grants half of its dividend to each investing credit union’s state foundation or league. NCUF uses the remaining portion of the CIF dividend to support its national programs and Financial Education Grants.

Top-performing CUs more apt to use advanced address-verification tools

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MADISON, Wis. (4/27/11)--The 100 top-performing U.S. credit unions are more likely than other credit unions to use advanced forms of address verification, which provide benefits such as increased member satisfaction and reduced costs, according to a recent report from Experian. The research evaluated 50 of the top 100 credit unions, as ranked by performance in the 2011 edition of the Callahan Report. The 50 credit unions participated in a short survey about address verification practices and data quality initiatives. In the report, address verification is defined as the practice of capturing, validating, cleansing and standardizing address information. Address validation practices were divided into four categories--no verification, ZIP Code level verification, premise level verification, or secondary level verification. Experian’s “2011 Address Verification Benchmark Report: The Top 100 Credit Unions” has several recommendations for credit unions:
* Quantify the amount of time, money and member “good will” currently spent on returned mail and service. * Execute a multipronged approach to cleansing data that includes:
* Staff training on the importance of overall data quality; * Use of back-end cleansing tools to continuously clean existing information over time, and to improve the quality of purchased third-party data; and * Point-of-capture address verification wherever data is entered, such as branches, call centers and websites, to standardize and ensure accuracy.
Key business findings of the report include:
* The most common level of address verification was no verification (32%). * Thirty percent of credit unions leveraged premise level address verification. Thirty percent used secondary level verification, the most advanced type. * Only 6% of respondents verify addresses at the ZIP Code level. ZIP Code verification is better than none. However, it generally results in low levels of deliverability, with house/building number and apartment/suite number often missing or inaccurate.
To view the report, use the link.

Three CUs re-affiliate with Texas league

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FARMERS BRANCH, Texas (4/27/11)--Three credit unions have re-affiliated with the Texas Credit Union League (TCUL). Pacific Employees CU, with $4.2 million assets, Beaumont, and $1.5 million-asset Union Pacific Employees CU and $3.2 million-asset First United CU, both of Tyler have re-joined the league. “I’m fortunate to have an exceptional board of directors who recognize that in order to continue UPECU’s successful operation we need additional support and resources,” said Jan Scroggins, manager of Union Pacific Employees CU. “We found that support in the league.” Among the resources the league offers small-asset credit unions is its Small Credit Union Development Initiative, which offers tools and resources, including a library, workshops and clinics, for credit unions with assets under $20 million. TCUL has also established a small-credit union committee of 17 credit union leaders. The committee meets regularly to discuss challenges and opportunities facing small credit unions. The league has facilitated the development of 14 small-credit union groups statewide. The groups are regionally based, giving credit unions the opportunity to attend local group meetings for educational programs.

New foundation to support mission in India

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WARMINSTER, Pa. (4/27/11)--Patrick Durkin, vice president of information technology at Freedom CU, Warminster, Pa., is on the board of directors for a new charitable foundation to support the Good Shepherd Mission in Puttur, India. Freedom CU is assisting the foundation.
Click to view larger imagePatrick Durkin, vice president of information technology at Freedom CU, Warminster, Pa., fills syringes at a medical camp at the Good Shepherd Mission on his recent trip to India (Photo provided by Freedom CU).
The foundation’s creation was inspired by a trip to India in February, where Durkin and 10 other individuals worked at the Good Shepherd Mission orphanage and free medical camps. During the nine-day trip, Durkin filled syringes for vaccinations and interacted with the children of the orphanage. I brought 300 bags of M&Ms for the orphans; we sponsored a meal and they got ice cream for the first time,” Durkin said. The foundation will wire donations through a Freedom CU account to the Good Shepherd Mission. Administrative fees will be covered by the foundation and all money collected from donations will go directly to support the orphanage and free medical camps. Durkin’s personal goal is also to purchase a new car for the group, because its current vehicle was in poor condition. The foundation also sponsors nursing students for US$300, who can be hired for the medical camps. The Good Shepherd Mission is without electricity after experiencing a debilitating storm this month. Many of the buildings have been damaged or destroyed. Henry Bakshak and his wife Viola began the Good Shepherd Mission when they brought six orphan boys into their home in 1978. Today, the orphanage supports about 150 children at two locations and medical camps that provide free medical and dental care for the children and local residents. Durkin says of Bakshak: “He does all of this on a shoestring budget, almost no money at all. We’re starting a new foundation, so we can get some real money for this place.”

CU System briefs (04/26/2011)

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* DOVER, Ohio (4/27/11)--A false bomb threat closed Dover, Ohio-based Tuscarawas Schools CU for the afternoon Monday. Several calls were placed before noon to employees from a person who said a bomb had been placed in the building and would go off at 2 p.m. The credit union was evacuated and a search did not turn up a bomb. Police and firefighters stayed on the scene and gave the all-clear at 2:15 p.m. However, the credit union closed for the rest of the afternoon ( April 25) … * WICHITA, Kan. (4/27/11)--A Wichita, Kan., man was sentenced to 20 years in prison for robbing the Catholic Family FCU on Nov. 8, 2010 (US Fed News April 25). Deshane Gantt pleaded guilty to one count of brandishing a firearm during a crime of violence. Armed with a 9 mm pistol, Gantt entered the credit union and told employees that this was a robbery and he didn't "want to turn this into a homicide." He vaulted the counter and collected cash from the teller drawers in a pillow case, then fled in a car driven by co-defendant Christopher Crabtree. Police stopped the car and arrested them. Crabtree was sentenced to 51 months in prison earlier this month (News Now April 14) … * BIRMINGHAM, Ala. (4/27/11)--Michael John Young, 42, of Kimberly, Ala., former president of Birmingham-based Alabama Central CU, has agreed to plead guilty to fraud against the credit union (Associated Press Newswires April 26). Court documents filed Monday indicate the fraud involved submitting bogus bills and invoices on behalf of two fictitious companies he created. The credit union paid money into the accounts of the fake companies. The fraud began about two years ago and ended last June, said the report. Young has agreed to pay restitution and forfeit $140,000 … * HARRISBURG, Pa. (4/27/11)--Pennsylvania state Rep. Mauree Gingrich (R-101) gave praise to credit unions during a ribbon-cutting ceremony for Hershey FCU's (HFCU) new facility in Annville, according to the Pennsylvania Credit Union Association (PCUA) (Life is a Highway April 26). Gingrich presented a proclamation, saying, "I truly value the role credit unions bring to the financial services industry, this community and consumers. HFCU is contributing not only locally, but also making Pennsylvania the great state that it is." She thanked HFCU for staying in Lebanon County "so people can continue to benefit from the great services it provides." Also attending the event were Joe Wambach, Pennsylvania Credit Union Foundation executive director, and Christina Mihalik, PCUA vice president, governmental affairs. From left are Hershey FCU President/CEO Diana Roberts, Gingrich, and HFCU Board Secretary Barbara McLaughlin. (Photo provided by the Pennsylvania Credit Union Association) …

CU System briefs (04/25/2011)

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* KANSAS CITY, Mo. (4/26/11)--An Armenian residing in Colorado pleaded guilty in a federal court in Kansas City to participating in an auto loan scheme intended to defraud credit unions and other lenders by buying $229,230 worth of expensive automobiles and jet skis at Kansas City-area dealerships, said the U.S. attorney's office for the Western District of Missouri. Artur Galstyan, 33, and co-conspirators allegedly submitted falsified credit applications through the dealerships to finance the vehicles and jet skis from November 2009 to September 2010. Galstyan admitted they had no intention of making payments on the loans. They shipped the vehicles immediately to the Russian Federation, which meant credit unions and other lenders could not recover the loans' collateral. The group leased apartments and office space in Kansas City to create the illusion that they lived and worked in the city. He faces up to 20 years in prison without parole, plus a fine of up to $500,000 (Targeted News Service April 13) … * LAKE COUNTY, Fla. (4/26/11)--Nazreen Mohammed, 47, of Summerfield, Fla., was sentenced to five years in a federal prison for fraud and identity theft while she was an employee of a Lake County branch of Orlando, Fla.-based Fairwinds CU and later at a Lake County branch of the Royal Bank of Canada. She also was sentenced to three years on supervised release and ordered to make full restitution to the credit union and bank. Mohammed pleaded guilty on Nov. 22 to the crimes, which occurred from April to July 2009 at the credit union and from Nov. 5, 2009 to Jan. 7, 2010, at the bank. In both incidents, she used her employee status to access member/customer accounts without authorization. She created loans and withdrew from the accounts of the credit union's members, then transferred the proceeds to accounts of other members before eventually withdrawing them. She also posed as elderly or deceased members when checking on the transfers of the money with the credit union's call center. She tried to get $127,431 from the credit union and $312,581 from the bank ( April 24) … * KENNEWICK, Wash., and PEKIN, Ill. (4/26/11)--Scammers using bogus text messages and phone calls have hit members and non members in Washington and Illinois, according to alerts from credit unions in those states. Credit unions targeted include Gesa CU and HAPO Community CU, both based in Richland, Wash., as well as other area financial institutions and businesses (Tri-City Herald April 24). In Illinois, Bartonville-based Redbrand CU members received text messages saying their ATM/credit cards have been deactivated and to reactivate the card, they must call a number ( April 23). The calls and text are ploys to get consumers to part with their credit card numbers and other sensitive financial information. Credit unions warned that no financial institution will contact them and ask for personal information … * SACRAMENTO, Calif. (4/26/11)--The Golden 1 CU received the "Exceptional Community Support" award at the 2011 People Helping People Awards luncheon April 12. The award, presented by the Community Services Planning Council, recognizes businesses, civic organizations and individuals for exemplary support for community projects and charities. Golden 1 was commended for contributing time, talent and resources to worthy causes. Its employees provided 2,752 hours of volunteer time during 2010. Golden 1's fundraisers for United Way and Children's Miracle Network Hospitals generated tens of thousands of dollars for the organizations and others. It also was recognized for providing free educational workshops that teach financial literacy to people of all ages. In 2010, nearly 9,800 people benefited from those workshops …

Black bear pays visit to N.J. league office

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HIGHTSTOWN, N.J. (4/26/11)--A 300-lb. baby black bear caused quite a commotion on the New Jersey Turnpike and in the New Jersey Credit Union League's parking lot recently, with news helicopters recording the event on video. On April 15, the bear rummaged through garbage cans for food before climbing a tree overlooking the turnpike near Exit 8, said the league (The Daily Exchange April 21). Construction workers discovered the bear in the league parking lot before office hours. No league employees had a close encounter with the critter. State wildlife biologists and firefighters used a tranquilizer and a Fire Department cherry picker to pluck the bear from the tree. To watch an Associated Press video of the action, use the link.

Disbanded CU chapter returns after eight years

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HARRISBURG, Pa. (4/26/11)--Credit unions in Pennsylvania's Endless Mountains Chapter reorganized last week after disbanding eight years ago, said the Pennsylvania Credit Union Association (PCUA). The chapter is making a commitment to conduct scheduled meetings and networking opportunities, said PCUA (Life is a Highway April 21). Former Chapter President Eric Chase, CEO of Guthrie FCU, welcomed 17 attendees and John Kilduff, PCUA vice president, Credit Union Services. Newly elected chapter officers are:
* President, Michael Viselli, CEO of Ingersoll-Rand FCU, Athens; * Vice president, Joe Beckwith, board member of Craftmaster FCU, Towanda; * Treasurer, Danielle VanNoy, CEO of Troy Area School Employees CU, Troy; * Secretary, Dena Miller, CEO, Craftmaster FCU; and * Legislative liaison, Chase.

Three trends lead to surge in community investing

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NEW YORK (4/26/11)--Community investing is poised for more visibility in 2011 as a result of three trends that could boost related investments from individuals and institutions, said the Social Investment Forum (SIF), Green America and the National Federation of Community Development Credit Unions in an April 13 news conference. Community investment involves capital from investors and lenders that is directed, often through community development financial institutions (CDFI) and other community investing institutions to underserved communities and individuals. Assets in community investing institutions rose more than 60% to $41.7 billion in 2010 from $25 billion in 2007, said the 2010 SIF report, the most recent data available. That reflects healthy growth in all categories of community investing institutions: community development banks, credit unions, loan funds and venture capital funds, said SIF. The three major trends include:
* Consumers breaking up with mega-banks due to high fees and other abusive practices. Community development credit unions (CDCUs) and community development banks have benefited from increased membership, assets and deposits in recent years, helped in part by dissatisfied consumers angered at mainstream banks' raising their fees and cutting back on credit throughout the recent recession, and by media campaigns to encourage consumers to dump abusive mega banks. * Rising institutional interest in community investing. Institutions in several categories are doing more community investing, in part due to SIF's education and outreach efforts with financial advisors, investment managers and religious institutions. Colleges and universities are now among the leaders in moving assets to community investments, providing market pressure for mutual funds and money managers to provide more socially responsible investment options. * Growing consumer awareness of community investing success stories. Most CDFI banks, formed after 1994 as small institutions, have grown at a greater rate than conventional banks of the same size by meeting pent-up demand. As community investing institutions meet local demands, they attract additional assets from individuals and institutions wanting to be part of such positive change and help local institutions to flourish.
CDCUs and other CDFIs "have played a crucial role throughout the recession by providing credit to borrowers who have been shut out of the conventional capital markets," said Clifford N. Rosenthal, federation president/CEO and a member of SIF's board. "A major challenge that remains is that many of our institutions have been disproportionately affected due to the economic distress of the communities they serve, so the growth in socially responsible investments has been indispensable in allowing many of our member CDCUs to expand their services at a time where other lenders have tightened their underwriting guidelines." For CDCUs nationwide, this increased investment will be crucial, given law-makers' slashing of government spending in their attempts to rein in the deficit. "While the Treasury Department's CDFI Fund has thus far been spared from major budget cuts, we really don't know how it will fare in the future," Rosenthal said. "Most legislators acknowledge the benefit of investing in CDFIs through the CDFI Fund, where each federal dollar is leveraged approximately 27 times by non-federal sources, but given some legislators' bottom line-only approach, which has slashed a host of social programs, no initiative is safe from cuts, which is why we are especially pleased to see a general shift towards greater community investment by the mainstream capital markets," he said. He noted that "we have many member CDCUs that operate as the only regulated financial institution in some of America's poorest communities. If they go, only the predatory check cashers, payday lenders, and pawn shops will remain to fill the void, and for those of us in the CDFI community, this is simply not acceptable."

CU limits directors to four terms

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PORTLAND, Ore. (4/26/11)--Unitus Community CU has implemented board term limits in an effort to increase member engagement. In its first meeting after the rule change, the credit union welcomed two new members to its board. Jim Lewis and Scott Thompson were elected to the board as board members Pete Reinecker and Barbara Leonard stepped down. Unitus Community CU board members are limited to four, three-year terms, or 12 consecutive years on the board. The decision to implement term limits--a controversial topic for many credit union boards--was part of a long process, according Unitus Community CU Pat Smith Northwest Credit Union Association Anthem April 14). The process began about four years ago when the board created a succession planning chart to document each director’s future plans, she said. “After a couple of years, we realized that we had no hard plans and that dates continued to be either ambiguous or were being updated to a new date each year,” Smith said. The topic of board limits was floated by the board’s chair, Gordon Akeson, who was among the board members considering retirement. The governance committee followed up by researching the pros and cons and the different elements associated with limits for board members. After 18 months of research, review, and discussion, the committee presented the various options and selected those that fit best with Unitus Community CU. The major benefit is the possibility of engaging more members in the governance process, said Smith, who points out that engagement is one of the foundational differences between banks and credit unions. Also, the board has reduced the ambiguity of its succession planning efforts and created a mechanism for new ideas. At the same time, term limits create some concerns, according to the Northwest Credit Union Association. Many long-time board members bring expertise, stability and continuity to the governance process. Learning the cooperative financial model takes time, and too much turnover can create a knowledge gap. With the current pace of regulatory change, educating a new board member is a challenge, observers say. However Laurie Kresl, vice president of planning and business development at Unitus Community CU, said Smith and Akeson, who has since retired, worked to educate the board throughout the process and ensure that a “pipeline” was developed to attract and develop new board members. Kresl said part of the term limits discussion was developing a more formal board application process that identifies candidates and competencies and board development with existing volunteers. “The board understood our needs,” Kresl said. “I think they understood if they loved they loved the credit union it was right thing to do. They owed it to the credit union to put someone in place to lead us into the future.”

Henke appointed to Kansas CU council

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TOPEKA, Kan. (4/26/11)--Kansas Gov. Sam Brownback appointed Sue Henke, a publications writer for the Kansas Department of Labor, to the Kansas Credit Union Council. The council advises the administrator of the Kansas Department of Credit Unions on issues and needs of credit unions ( April 21). Appointees serve a three-year term. Henke, of Topeka, has more than 35 years combined experience in public information/communications. This is her second appointment to the commission.

Missouri tornado levee break damage CUs

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ST. LOUIS, Mo. (4/26/11)--Two credit unions in Missouri were directly affected by Friday's massive 166-mph tornado in St. Louis County, while others had near-misses. And on Monday, a levee break in the southeastern part of the state left one credit union with water in its basement, reported the Missouri Credit Union Association (MCUA). April has already seen a record number of tornadoes--292 confirmed so far, passing the previous record of 267 during the month in 1974. The number of twisters is almost twice the average 163 for April (USA Today April 25). May is usually a worse month for tornados, said The Weather Channel. More than 2,000 homes and the Lambert-St. Louis International Airport were damaged in the county by Friday's Class 4 tornado, which means it had winds of between 166 mph and 200 mph. The worse damages were in Maryland Heights, Bridgeton, St. Ann, Edmundson, Berkeley and Ferguson, as well as in Madison County near Granite City, said the National Underwriters Online News Service (April 25). At the airport, the office of American Airlines FCU Branch Manager Lindsay Beasley was damaged, although the actual credit union was not. Beasley's office is located over the C Concourse, said Amy McLard, MCUA vice president of public and legislative affairs. McLard said MCUA received reports from field representatives about the damages, which included upended furniture and broken windows. Another credit union with a branch across from the airport, Community America CU, reported no damage. It was closed on Saturday because the airport was shut down but reopened Monday, said MCUA. Vantage CU, whose headquarters is in hard-hit Bridgeton, reported "minimal" damage. It was closed on Monday because it had no electricity and was surrounded by debris, its website said. "Vantage is in the midst of the all the damage. It's amazing it had only minimal damage," McLard told News Now. She noted the league office is about 10 minutes from the tornado's path. "We're fine," she said. Another Missouri credit union was damaged by flooding when a levee in Southeast Missouri broke Monday, McLard said. Cape Regional CU, based in Cape Girardeau, reported water in its basement, according to MCUA. It is too soon to tell how many credit union members and employees are affected. Once that is known, Missouri's credit unions will rally to raise funds and determine how to best address their communities', McLard said.

How CUs celebrated youth week

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MADISON, Wis. (4/26/11)--Credit unions nationwide held many events to celebrate National Credit Union Youth Week last week and also offered other financial education-related activities.
Click for slide show To celebrate Financial Literacy Month (April), Credit Union Youth Week (April 17-23) and the Week of the Young Child (April 11-15), Health Services CU, Dubuque, Iowa, and Mercy Child Development Center, both in Dubuque, collaborated on a fun, interactive activity teaching preschoolers the importance of savings. The activities occurred April 14 and April 15. (Photo provided by Health Services CU)
Youth week always is the third week of April and is sponsored by the Credit Union National Association. “Money Rocks at my Credit union” was the theme of the week. Some examples are:
* During “Money Rocks at my Credit Union,” Fremont (Ohio) FCU invited children and teens last week to stop by one of its offices to see how their money can rock at the credit union by making deposits to their Dollar Dog Kids Club or Cha-Ching Teen Club accounts (News Herald April 19). Attendees were invited to sign up for special prizes and to receive free giveaways all week. Each of the credit union’s four offices also gave away two $25 Visa gift cards at the end of the week. * North Carolina Gov. Beverly Perdue proclaimed the week of April 17-23 as North Carolina Youth Savings Week (Weekly Update April 15). Perdue issued the proclamation to highlight the value of saving money and teaching young people money management skills. “Maintaining a savings account is an investment in the future for youth,” Perdue wrote, “and helps young people learn financial literacy and work towards goals.” The proclamation came through the coordination of the governmental affairs team of the North Carolina Credit Union League (NCCUL). Lauren Whaley, NCCUL’s director of legislative and regulatory affairs, worked with the governor’s office to develop the proclamation and said the league was motivated by the combined efforts of credit unions. * Wisconsin Gov. Scott Walker recognized Central City CU, Marshfield, Wis., as part of a group of credit union representatives that received a proclamation from him last week during National Credit Union Youth Week (Marshfield News-Herald via April 12). Paul Kurth, Central City marketing manager, accepted the governor’s proclamation on behalf of Wisconsin credit unions. Central City was invited by the Wisconsin Credit Union League in honor of its youth financial education efforts, which earned the credit union a first-place state-level Desjardins Award. Central City operates three youth-run branches in Marshfield and Stevens Point, Wis., area high schools, and Nasonville Elementary. Central City also partners with teachers to bring financial lessons into the classroom on topics that include budgeting, credit scores and interest rates. * Kellogg Community FCU (KCFCU), Battle Creek, Mich., encouraged children and teens during youth week to learn the value of saving money (Michigan Monitor April 18). Events included contests, drawings, a financial quiz, informative handouts and financial literacy classroom visits at local schools. “National Credit Union Youth Week provides KCFCU with a great opportunity to educate youth about the importance of finances in a fun and exciting way,” said Kellogg Community CEO Tracy Miller. “Engaging students with fun activities like Credit Union Youth Week is one way we can help them develop responsible money habits at an early age, which will benefit them for a lifetime. KCFCU is committed to financial literacy for youths and adults, as well as encouraging positive money management skills which help our members achieve their financial goals.” * Credit Union ONE, Ferndale, Mich., recently used its Oakland University Facebook page to allow the Rochester, Mich.-based Oakland University campus clubs to compete for cash. Two campus organizations won a popularity contest that garnered each group $250. The contest began March 7 with one challenge: Generate the most fans at through April 7 and win cash. The 16 participating organizations generated 352 votes. “Credit Union ONE only recently launched the campus Facebook page,” said Gary Moody, Credit Union ONE president/CEO. “The contest is among the ways that we hope to generate interest and participation in the page. If students have other ideas of increasing our fan base, we want to hear it.” * Belvoir FCU, Woodbridge, Va., attended the Army Community Service (ACS) Teen Employment Workshop on Fort Belvoir Military installation, Wednesday. Belvoir shared information with the more than 20 students about financial planning and budgeting when looking for a job, what to look for when applying for a job, and summer employment opportunities available at their local Belvoir FCU. Belvoir Financial Coach Kelli Jo Anthon’s presentation focused on the importance of setting smart goals to achieve success in one’s personal finances and chosen career. Anthon’s presentation also provided students an understanding of the difference between gross pay and net pay, saving at least 10% per paycheck, and managing income. * Beacon FCU, LaPorte, Texas, announced it will give teens a “reality check” with a Financial Reality Fair May 4 that will teach lessons lesson in money management. Financial Reality Fairs, part of the REAL Solutions initiative, gives youth the opportunity to participate in a hands-on event that guides them through the personal financial management process--which includes budgeting, saving and investing in a simulated real world environment. Some 100 youth are expected to attend. Participants will meet with representatives of auto dealerships, realtors, lenders, utility providers and retailers to help them understand the expenses they will encounter in adulthood and the choices they’ll need to make to avoid debt. * OUR CU, Royal Oak, Mich., said it is taking financial responsibility to a new level by partnering with FamilyMint, an award-winning, hands-on budgeting and educational application designed for kids ages 5 through 16. FamilyMint provides parents with an interactive and simple resource to help raise money-smart kids and is provided at no cost to OUR CU members. With FamilyMint, kids learn by managing their own money in a safe, virtual environment, and parents act as the banker and custodian of the money. Children take control of their money, allocate savings, set goals and make transactions. Parents can automate allowance, encourage savings with motivating interest rates, and reward deposits for worthwhile goals. * Credit unions in Northwest Ohio partnered with Terra Community College, Fremont, to help set young people on the right financial path with a life-sized interactive game full of life lessons through “Finances 101: Walk the Walk, Talk the Talk.” More than 300 high school students from seven Northwest Ohio schools (11 classes) participated in the event April 12, at Terra Community College. The students “life” experience included: salary-based jobs, the opportunity to have children, purchase a home and car, acquire insurance and pay utilities. Students learned about issues, including how earnings affect buying decisions, what it costs to run a household, and how to prevent spending beyond their means.

WCMS to honor 50th graduating class

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CLAREMONT, Calif. (4/26/11)--Western CUNA Management School (WCMS) will celebrate its 50th anniversary--and its 3,500 graduates during five decades--with a special graduation celebration and conference July 20-21. Credit Union National Association President/CEO Bill Cheney will serve as the 50th graduating class commencement speaker, and Google Vice President of People Operations Laszlo Bock will be featured as the conference keynote speaker. Other conference speakers will include long-time WCMS faculty members Martha Andresen, Harry Eggleton, Joe Melchione and David Tansey. Since first opening its doors on the UCLA campus in 1960 with 42 students, WCMS has helped prepare thousands of credit union management staff to become regional and national leaders for the credit union movement. “For the past five decades, WCMS has helped produce new generations of leaders deeply committed to credit union principles and the continued success of our movement,” said Bill Cheney. “By helping prepare tomorrow’s credit union leaders to carry on the mission, philosophy and ideals of the credit union movement, WCMS is playing a vital role in improving the lives of millions of credit union members.” “Every year graduating students report that WCMS profoundly changed their lives,” said WCMS President and Dean James Likens. “Some say they found a voice they had never before been able to express. Some say they realized for the first time that they are competent. Others say they feel a new connection to themselves, to others and to our movement.” Located at Pomona College in Claremont, Calif., WCMS serves credit union employees from the participating credit union leagues of Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington and Wyoming. WCMS said its culture embraces high academic standards while emphasizing credit union philosophy. It stresses “head and heart”--understanding the best strategy and tactics while bringing passion and commitment to the service of credit unions and their allied institutions. WCMS shares a vision and purpose with its sister regional CUNA Management schools located at University of Wisconsin, University of Georgia, and Texas Christian University. WCMS’ program is held over three years, with two-week terms during consecutive summers. Students also complete two projects that analyze their credit unions. During the WCMS experience students organize class activities. Each class plans a fundraising social event for the entire school. The classes contribute the funds raised to WCMS for scholarships and enhancements.

HarborLight Option 1 asks members to help save free checking

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LANSING, Mich. (4/26/11)--Two credit unions in Michigan are enlisting their memberships in a campaign to stop the interchange rule and save free checking for consumers (Michigan Credit Union League Michigan Monitor April 18).
Harborlight CU, Whitehall, Mich., is among the Michigan credit unions educating its membership on the possible effects of the interchange proposal. Here, HarborLight CU staff member Cheryl Brown, left, explains to member Kelley Patino how to send a message to her legislators the debit interchange law.
Harborlight CU displays a poster in its lobby urging its members to take a proactive stance in preserving free checking.
Harborlight CU, Whitehall, Mich., designed “Save My Free Checking” cards and is handing them out to all members. HarborLight CEO Linda Wood said the efforts began by educating frontline staff about how the interchange rule will impact both credit unions and consumers. Member service representatives urge members to contact their local congressional members. The credit union is also displaying a poster in its lobby. CEO Linda Wood said members have asked questions about the rule. “I think they will respond,” Wood said. Option 1 CU, Grand Rapids, has designed a brochure explaining to members what the interchange proposal means and what they can do to help. The brochure cover page is headlined “Congress and the Federal Reserve want to force you to pay more to use your debit card. Learn how you can help.” Inside, the brochure outlines the interchange issue, explains what members can do to repeal the amendment and provides talking points for correspondence with congressional representatives. Jerri Schmidt, Option 1 vice president of marketing, said credit union employees at all levels are urging members to contact their legislators about repealing the proposal. “Wherever we come in contact with members, we try to educate them on the issue,” Schmidt told News Now. “It’s become more and more of a priority for us.” Schmidt said Option 1 has considered doing an e-mail blast to its entire membership about the interchange proposal. The Michigan Credit Union League, like other state credit union assocations, is encouraging state credit unions to join the cause and help fight the interchange rule, which is scheduled to go into effect on July 21. Interested credit unions can visit for ideas on how to help. The Credit Union National Association (CUNA) opposes a proposal in Congress capping interchange fees and has told federal lawmakers that such action would harm consumers by driving up costs of debit cards, limiting consumer options, and harming competition and technological innovation. Interchange fees allow business costs, including the risk of consumer nonpayment, to be shared by the payments participants, CUNA said.

MSUFCU members save a million and beat deadline

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EAST LANSING, Mich. (4/26/11)--Members of Michigan State University FCU (MSUFCU) beat the deadline for saving $1 million in loan interest by a week in the credit union's One Million Dollar Challenge promotion.
MSUFCU Marketing Manager Julie Rosenthal, left, presents a $500 check to members Robert and Dorothy Hardman after they took part in the credit union’s One Million Dollar Challenge. (Photo provided by the Michigan Credit Union League)
In the promotion, which lasted from Jan. 5 to March 31, the credit union challenged members to save by refinancing their loan and credit card balances from other financial institutions with MSUFCU, the credit union reported to the Michigan Credit Union League. Members exceeded the goal and saved nearly $1.1 million on about $7 million worth of loans (Michigan Monitor April 25). Three members who refinanced loans with the credit unions also won a $500 prize. "The One Million Dollar Challenge presented the perfect opportunity for MSUFCU members to establish new, low-rate loans with the credit union without taking on additional debt," said April Clobes, executive vice president of the East Lansing-based credit union. "When we initially set the goal of saving members $1 million in interest in only 72 business days, I was a little hesitant that it could be done. However, we received a great response from our staff, members and the local community, and we're thrilled we were able to surpass our goal and save members so much money," Clobes told the league.

Mich. couple file more suits on ATM fee disclosures

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DETROIT (4/25/11)--A Michigan couple--who drive around looking for ATMs without proper fee-notification signs and then file class action lawsuits against financial institutions without the signs--filed four more lawsuits over ATM disclosures last week in Michigan. The latest batch are all against credit unions. The couple, Nancy Kinder and Ray Harrison of Fowlerville, Mich., claim in the lawsuits that nondisclosure of fees charged for transactions at ATMs violates Regulation E, the Electronics Funds Transfer Act, which has required institutions to post a notice in a prominent place on the ATM about fees. Court records indicate they travel the state by car and photograph ATMs without legal signage. They have sued 36 credit unions and bank in two years, according to Associated Press Newswires (April 22). Similar suits have been filed by others in other states as well. Kinder is involved in at least 11 cases the past two years, filed on her behalf by an attorney from Chevy Chase, Md., Geoffrey Bestor. The most recent cases--filed on April 18 in the U.S. District Court for the Eastern District of Michigan (Detroit)--are against:
* Lenco CU, Adrian, Mich., with $51 million assets; * Michigan Schools and Government CU, Clinton Township, with more than $1.04 billion assets; * Jackson (Mich.) Community FCU, $29 million assets; and * Northwood CU, Royal Oak, $20 million assets.
Other suits she has filed against credit unions include: ELGA CU, based in Burton, Mich., with $260 million assets, filed on April 16, 2010, and Sunrise Family CU, based in Bay City, Mich., with $90 million in assets, filed July 8, 2009. The case against Sunrise Family was closed on Oct. 21, 2010. Court records said the case "is dismissed with prejudice and without costs, sanctions or attorneys' fees awarded in favor or against either party." Kinder also has filed against these banks:
* United Bancorp Inc., filed Feb. 3, 2011; * Paramount Bank, filed June 29, 2010; * Bestbank, filed June 29, 2010 and closed Feb. 1, 2011; * Dearborn Federal Savings Bank, filed June 29; and * Community State Bankcorp, filed June 29, 2010, and closed Dec. 23, 2010.
The American Bankers Association told the Associated Press that the lawsuits are frivolous. In January, CUNA Mutual Group warned its policyholders of a "significant" spike in lawsuits against credit unions related to ATM fee disclosures. Twelve suits were filed between mid-December and the January (News Now Jan. 14). At that time, the insurance company said many credit unions sued erroneously believed that a fee notice sign was not necessary since the fee was disclosed on the terminal screen of the ATM. Some suits were prompted when institutions changed their fees but not their signs. Reg E requires credit unions to post a sign--in a prominent, conspicuous location on and at every ATM they own or operate--stating that a fee will or may apply. It does not require the actual fee to be placed on the sign. It also requires disclosing the fee on the terminal screen or paper notice before the consumer is committed to paying the fee. The fee should also appear on the transaction receipt. CUNA Mutual warned credit unions to develop and write procedures for inspecting their ATMs regularly to ensure the signs are intact, and to photograph the ATM at the time of inspection, maintain an inspection log for all ATMs and have management review the log. The log should include the location inspected, date, status of the sign (missing or present), action taken (replaced the sign) and initials of the employee performing the inspection. Also keep a supply of signs or stickers to replace missing ones, and periodically test the ATM with a non-credit-union-issued ATM network card or debit card to confirm the fee appears on the screen.

Two indicted for skimming four CUs affected

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FAYETTEVILLE, N.C. (4/25/11)--Two Russian immigrants were indicted Tuesday on charges of using skimming devices at three ATMs in Fayetteville, N.C., to steal data from debit and credit cards used at the machines. More than 60 people were affected. Four credit unions are among the seven financial institutions that lost funds. Sergei Fowler Marchant, 23, and Nikolay Andreyevich Volosov, 25, were indicted in a federal court in Fayetteville on charges of conspiracy to commit bank fraud and aggravated identity theft (Fayette Observer via April 22). Skimmers are electronic devices that record information stored on the magnetic stripe of a credit or debit card. The two men also are accused of installing camera to capture personal identification numbers. They allegedly used the stolen data to create counterfeit credit and debit cards, which were then used to make withdrawals from financial institutions in the area. The crimes occurred between May 1, 2009, and July 31, 2009. Among the credit unions affected: Fort Bragg, FCU, Pentagon FCU, State Employees' CU, and FAA CU. Also targeted were Bank of America, JP Morgan Chase and Wachovia banks. Marchant and Volosov are each charged with six counts of card theft with a scanning device, financial card forgery and identity theft, as well as three counts each of financial card fraud and two counts of misdemeanor financial card fraud, said the newspaper.

TCUF ready to assist wildfire victims

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FARMERS BRANCH, Texas (4/25/11)--The Texas Credit Union Foundation reminded the state's credit unions Friday that it stands "ready to assist" credit union employees affected by Texas wildfires during a drought. A massive wildfire was burning 70 miles west of Fort Worth on Wednesday, said USA Today (April 21). The blaze is one of several fires that have charred about one million acres across the state in the past two weeks. More than 340 people, including a federal team, the Texas Army National Guard and local personnel fought that blaze, which burned about 150,000 acres and destroyed 50 homes, said the newspaper. The foundation said it has two phases of grants available for credit union employees (LoneStar Leaguer April 22).
* Phase One Emergency Grants are provided to credit union employees to assist with immediate disaster relief needs such as out-of-pocket expenses from an evacuation. The intent of the $500 grants is to help stabilize employees' situation grants so they can return to work. * Phase Two Disaster Relief Grants assist credit union employees with significant needs after other forms of relief have been exhausted. Amounts granted are dependent of the amount of funds but usually are $1,000-$3,000. TCUF said the grants are implemented after Phase One Grants are distributed. The foundation will issue a call to the CEOs of affected credit unions for these grants.

Firm affirms CUNA Mutuals strength elevates outlook

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MADISON, Wis. (4/25/11)--Financial ratings agency A.M. Best has affirmed CUNA Mutual Group’s “A” (Excellent) financial strength rating and returned the company’s outlook to stable. The “A” rating applies to the principal companies of CUNA Mutual Group--CUNA Mutual Insurance Society, a life and health insurer, and CUMIS Insurance Society, Inc., a property and casualty subsidiary. The rating is the third highest rating of the 16 categories of ratings A.M. Best issues. “During these difficult economic times, CUNA Mutual has worked hard to keep premiums down, deliver greater value to credit unions and their members through our products and services, and still grow our company's financial strength,” said Jeff Post, president/CEO of CUNA Mutual. He said that “A.M. Best acknowledges our strong performance in affirming our rating and upgrading our outlook to stable.” The rating and improved outlook reflects CUNA Mutual’s solid capitalization and consistently positive operating gains, said A.M. Best, citing CUNA Mutual’s improvement in the overall quality of its balance sheet. A.M. Best also affirmed the “A-“ (Excellent) financial strength ratings of Producers Agriculture Insurance Company and Producers Lloyds Insurance Company (ProAg) with a stable outlook. A.M. Best cited ProAg’s historical operating profitability and strong agency relations in affirming these ratings. The financial strength rating of MEMBERS Life, a dormant downstream life company that is not core to CUNA Mutual’s operations, was affirmed at B++ (Good) with a stable outlook.

CUNAs Hampel analyzes inflation pressures for IFox BusinessI

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WASHINGTON (4/25/11)--Rising gas prices is a short-term phenomenon that is not enough to derail the economy, Credit Union National Association (CUNA) Chief Economist Bill Hampel told Fox Business during an interview Friday afternoon. In a segment entitled "Is inflation a real threat to economic recovery," Hampel provided an analysis of the inflationary pressures Gas prices are increasing to as high as $5.50 and $6 in Florida last week. "These work like an extra tax [on Americans]. Fortunately, gas is a small portion of all the prices we pay. It's the only one we see in big letters," he said, adding there is a psychological impact that may lead households to believe inflation is rising. "That's the portion of the household budget that is draining away. It's nasty, but not enough to derail the economy," Hampel said. That expectation of inflation just around the corner is "another hurdle to work through" and it "will slow the economy this year, but not enough to derail us back in a double dip recession," Hampel added. "Consumers are smarter than we think. The short-term inflations expectation by households is through the roof, but their long-term inflation expectations are not." Will the economy slow down? There are a lot of negative reports, but "the economy in the past six months has been building momentum," he said. "The employment situation is picking up. Consumers haven't been spending, but they have a lot of pent-up demand for cars and other durables, and businesses have a pent-up demand for capital goods." He noted households are paying down debt. He also noted the job market is picking up steam. After a loss of nine million jobs the past one and a half years, the nation has picked up another 1.5 million jobs. Hampel also addressed when the economy could be sustainable again without government stimulus. The Federal Reserve's policy making board that sets the fed target funds rate--the Federal Open Market Committee--will meet Tuesday and Wednesday. "I don't think the Fed is going to raise rates," he said. For that to happen, he added, the nation would need for the unemployment rate to go down toward 7.5%, and inflation would have to rise and stay for an extended time. He does not expect a rate increase before fourth quarter 2011 or first quarter 2012, he told Fox Business.

Union leaders to pull funds from five banks look to CUs

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ORLANDO, Fla. (4/25/11)--Labor leaders in Central Florida said Thursday they will pull their money out of five banks that support what they call "union-busting" legislation. Instead, they will move their money to community banks and credit unions. They also said they're advising thousands of union members to make the switch as well. Unions representing police, firefighters, teachers and white-collar and blue-collar workers announced at a news conference they will pull funds from Bank of America, PNC, Regions Bank, SunTrust and Wachovia (Orlando Sentinel April 22). Each bank is represented on the Florida Chamber of Commerce, which is advocating a measure moving through the state legislature that would prohibit state and local governments from collecting union dues through payroll deduction. Those involved in the news conference lead the International Association of Fire Fighters; the Fraternal Order of Police; the American Federation of State, County and Municipal Employees; Service Employees International Union and the AFL-CIO.

Filene report Will social media really help CUs grow

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MADISON, Wis. (4/25/11)--Organizations that aren’t on Twitter, Facebook or YouTube are at risk of becoming culturally obsolete, but do social media help organizations grow? The Filene Research Institute has released a report that looks for answers to that question from a credit union perspective. “The State of Social Media in Credit Unions: Opportunities and Challenges” is the front end of a yearlong study from Filene. The research, conducted for Filene by Crescendo Consulting Group LLC, examines the extent of social media usage among credit unions, highlights characteristics of credit unions currently using social media, and looks at practices that drive social media success. In the first report, respondents offer self-assessments or their success with social media. A second report, due out in early 2012, will use measurable changes--such as asset growth, increase share of wallet, increased membership—to measure social media success. Some of the highlights from the first report:
* Social media success comes with experience. Credit unions with more than two years of experience are most likely to report success (57%); those that have three months or less are least likely (17%). * There’s no substitute for time. Credit unions that spend more than eight hours per week on social media and those with more than 10 employees in the marketing department are by far the most likely to report successful programs. * Success with social media reflects other product and service and branding activity. Credit unions with updated logo or brand image campaigns reported increased social media success. Those launching five or more new products had similar results. * Successful social media campaigns are purposeful. Credit unions that say their social media goals align with the credit union’s strategic goals report the highest levels of success in their social media programs.
The report provides information from the baseline survey, conducted in late 2010, including a summary of the findings and their management implications. The study includes data from 187 credit unions of diverse sizes and membership compositions across the U.S. and Canada.

Oregon Senate passes updated CU Act

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SALEM, Ore. (4/25/11)--The Oregon Senate on Wednesday overwhelmingly approved an update to the Oregon Credit Union Act, making several changes to the state charter. While most are viewed as “housekeeping” measures, they seek to clarify and streamline some governance processes, according the Northwest Credit Union Association, which represents credit unions in Washington and Oregon. Among the elements of SB 177, which passed by a 27-1 vote, are amended requirements for meetings of board of directors, which will permit greater scheduling flexibility. The legislation exempts standard mortgage loans to directors or senior managers from the requirement for board approval, and adds safeguards for loans to directors and senior managers. SB 177 also increases the limit for loans to and investments in credit union service organizations to 5% of assets from 2% of assets. The legislation clarifies member voting rights for mergers and outlines procedures for members to communicate on a credit union merger. SB 177 had “such strong bi-partisan support,” in the Senate, said Pam Leavitt, Oregon state legislative director for association. “We will be working very hard to get this bill scheduled in a House Committee as soon as possible,” she added. Working under strict legislative guidelines, the bill must be scheduled for a hearing and work session before the end of May.

CU System briefs (04/22/2011)

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* BURLINGTON, Vt. (4/25/11)--About 35 credit union leaders gathered in the Vermont Statehouse Wednesday to discuss the credit union legislative agenda and meet with many of the state’s 180 elected officials. Participants listened to Senate President John Campbell (D), Speaker of the House Shap Smith (D), and Chair of the House Commerce Committee Bill Botzow (D). Attendees also heard about both state and national issues from Department of Banking, Insurance, Securities and Health Care Administration Deputy Commissioner Tom Candon; Association of Vermont Credit Unions (AVCU) President Joe Bergeron; and AVCU lead lobbyist Adam Necrason. The meetings were followed by AVCU’s annual Legislator Appreciation Reception where credit union leaders had the opportunity to meet individually with many state legislators … * COMPTON, Calif. (4/25/11)--Mid-Cities Financial CU met with the
Click to view larger image Click for larger view
Los Angeles Small Business Administration (SBA) District Office and Advantage Certified Development Corporation (CDC) to discuss partnering on small business loans to help stimulate the local economy. Mid-Cities Financial CU was recently approved by the SBA District Office to offer SBA 7a loans for small business and 504 collateralized business loans. From left: Maricela Jauregui, Mid-Cities Financial CU branch manager; Bessie Griffin, community development manager; Melia Keller, president/CEO; Henry Perez, loan manager; Euhoe Park, SBA Los Angeles district office lead lender relations specialist; and Farooq Ahmad and David Ezaki, Advantage CDC business development officers (Photo provided by Mid-Cities Financial CU … * MADISON, Wis. (4/25/11)--The Worldwide Foundation for Credit Unions has teamed with the State Bank of Cross Plains, Wis., a local community bank, to raise funds for the Busia Compassionate Care Center, a Kenyan orphanage housing 67 orphans age three to 21, many of whom are HIV-positive. The orphanage is supported by the World Council of Credit Unions (WOCCU) and its Global Women's Leadership Network. The foundation entered a page on the bank's Champions for Charity website. The charity page receiving the most votes wins $1,000. To vote, enter the site and find the page with Pepi Dougherty (assistant to WOCCU chief operations officer and executive vice president Brian Branch) featured as a champion for the worldwide foundation. The foundation hopes to build a new orphanage with running water, a new school and a vocational trade center to help the children prepare for the future. The website will run through May 18 … * BANGOR, Maine (4/25/11)--Donovan W. Steen Jr., 20, of Bangor, Maine, was sentenced Thursday to eight years in prison, with all but three and a half years suspended, for robbing a credit union and stealing more than $4,000 in jewelry and computer equipment from his family. Steen pleaded guilty on March 24 to robbing the Bangor branch of Penobscot County FCU on Jan. 18 and taking the jewelry, which was recovered. Steen's mother called the police after the jewelry theft and he was arrested Jan. 19. After he completes the prison term, Steen must also serve three years' probation and pay $1,150 in restitution to the credit union (Bangor Daily News April 21 and Jan. 19) …

NACHA warns fraudulent e-mails continue

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WASHINGTON (4/25/11)--NACHA--The Electronic Payments Association said Friday that it has been receiving reports that individuals and companies continue to receive fraudulent e-mails that appear to be sent from NACHA. NACHA said the content of the e-mails varies, but they mistakenly appear to be transmitted from e-mail addresses associated with the NACHA domain ( Some bear the name of fictitious NACHA employees, departments, or both. "NACHA itself does not process nor touch the ACH (automated clearinghouse) transactions that flow to and from organizations and financial institutions. NACHA does not send communications to persons or organizations about individual ACH transactions that they originate or receive,” the group advised in a release. The warning noted that phishing e-mails, such as these, frequently carry attachments or links to Web pages that host malicious code and software, which should not be opened or visited. NACHA asked that fraudulent e-mails claiming to be from NACHA be sent to

IMoneyTalkNewsI says Leave bank join a CU

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NEW YORK (4/22/11)--A article Tuesday about a survey that indicates 51% of consumers polled would shop for another bank if their bank increased its fees offered this advice: Find a new bank. "Or better yet, don't use a bank at all. Use a credit union instead." "Why It Might Be Time to Leave Your Bank--and 3 Steps to Replace It" also referred readers to the Credit Union National Association's credit union locator to get a list of credit unions nearest to the reader. Finding a new bank or credit union is step No. 1. The other two steps? Ease away from the old bank with a "switchkit"--a collection of paperwork needed to redirect your direct deposit and automatic bill payment to the credit union. And avoid cashing out and closing down without giving the old account time to clear all the checks and automatic deposits and withdrawals. The article also reported on a survey by the National Foundation for Credit Counseling, which asked 2,200 people what they would do if their bank raised its checking account fees. Fifty-one percent said they would shop for another bank, while 16% would complain to the bank, 16% admitted they probably would never notice, 11% would grin and bear it, and 6% would close the account and use a prepaid debit card. To access the full article, use the link.

Alloya Corporate FCU is new name of Members United

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WARRENVILLE, Ill. (4/22/11)--Members United Bridge Corporate FCU has a new name: Alloya Corporate FCU. The name, which is a combination of the words "All," "Alloy," and "Loyal," was announced Thursday by John Fiore, chairman of the Warrenville, Ill.-based corporate's Members Advisory Council (MAC), in a letter to members posted on the corporate's website. Fiore noted the name has received trademark clearance and has been filed with the U.S. Patent and Trademark Office for registration. For a 70-second video that demonstrates the attributes of the name, use the link. "Our criteria required that the name be distinctive, memorable, and timeless," he said. "We sought to project the values of an entity that is within the system, is member-owned, is central to the members' business, and is where service to members is paramount. We wanted the name to have energy, sound and look good, and stimulate discussion. Finally, we wanted a non-traditional name to reflect the difference in our business model." "Work continues with our attorneys to complete the private placement memorandum for the capital offering. We are also finalizing the schedule for a series of town hall webinars to discuss details of the plans, the private placement memorandum, and to answer questions," Fiore said. The webinars will take place throughout May and June, with the first two webinars tentatively slated for May 4 and 5. Over the next few weeks, the corporate will transition to a new website for Alloya to segregate information about Alloya Corporate from the day-to-day transactions of Members United Bridge. More information on the transition will be available at the MAC website. The corporate had filed its capital plan on March 18 with the National Credit Union Administration (NCUA). Last week, NCUA's Office of Corporate Credit Unions informed the corporate it has no objection to the capital plan (News Now April 19).

WOCCU to CUs Use 2012 International Year of Co-ops

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MADISON, Wis. (4/22/11)--The World Council of Credit Unions (WOCCU) is urging credit unions to use the new logo released earlier this month by the United Nations (U.N.) International Year of Cooperatives (IYC) Secretariat recognizing 2012 as the International Year of Cooepratives. WOCCU is urging credit unions worldwide to join with other cooperatives in using the logo, which is in six languages, to increase public awareness about cooperatives' contributions to socio-economic development, as well as promote the sector's growth and encourage favorable policies. The logo illustrates the official 2012 IYC theme released earlier this year--Cooperativa Enterprises Build a Better World. "Credit unions and other cooperatives did well by their members during the recent financial crisis, and the U.N.'s International Year of Cooperatives is an important effort to help reposition and rebrand cooperatives in the minds of consumers," said Pete Crear, WOCCU president/CEO. "We touch members' lives in ways they may not always realize, and the Year of Cooperatives is a critical opportunity to emphasize the cooperative difference." WOCCU encourages credit unions worldwide to use the IYC logo and the official theme on member statements, ATM receipts and screens, websites and other credit union materials throughout the year to increase awareness of cooperatives and credit unions as socially oriented businesses among young adults. The logo conveys the idea that, as member-owned, democratically controlled businesses, cooperatives exist to meet the common economic, social and cultural aspirations of their members. Credit unions must request permission to use the logo and slogan. To download the logo and permission request form, use the link. IYC officially begins Oct. 30, 2011, with a celebration at the U.N. headquarters in New York City, and runs through November 2012. WOCCU has formed a global advisory committee of member organization representatives and is coordinating with the International Cooperative Alliance (ICA), the global cooperative association collaborating with the U.N. on the event, and the U.S. National Cooperative Business Association. Credit unions, cooperatives and their trade associations have been asked to contribute financially to the organizing efforts to assure that IYC initiatives will be successful. For more information, contact ICA's Nicola Kelly, International Year of Cooperatives 2012 coordinator, at +41-22-929-88-27 or at This year's International Credit Union Day on Oct. 20 will incorporate the IYC 2012 objectives. The close proximity of the two events provides a greater opportunity for credit unions to get involved and raise awareness among their members, legislators and communities of the tangible changes they are making on a local, national or international level. "With the spotlight on cooperatives, credit unions have a unique opportunity to show community members and policymakers the tangible changes they are making on a local, national or international level and educate them on the cooperative difference" said Dave Grace, WOCCU senior vice president of association services heading WOCCU's IYC efforts. "Part of that process is making those stakeholders aware of all the ways in which cooperatives already touch their lives." For more information, use the link.

Whats new with student-run branches

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MADISON, Wis. (4/22/11)--More credit unions are opening student-run branches in local schools, and at least four of these received attention during National Credit Union Youth Week.
Click to view larger image At Central City CU’s Stevens Point (Wis.) Area High School’s branch—SPASH--(from left) branch coordinator Trudy Peters explains as student intern Ashley Higgins processes a student transaction while Principal Michael Devine, Wisconsin state Sen. Julie Lassa, and Wisconsin Department of Financial Institutions Secretary Peter Bildsten look on. (Photo provided by Central City CU)
The student branches achieve three purposes: educating their members about wise money management, providing workplace experience for students, and provide an outreach program for future members. In Stevens Point, Wis., Central City CU's Stephens Point Area High School (SPASH) branch became a focal point Wednesday for discussing the importance of a strong financial education as a base for long-term financial success. Visiting the credit union were state Sen. Julie Lassa and Department of Financial Institutions Secretary Peter Bildsten. Both saw what makes in-school branches so successful. "I spend a lot of time working with students on financial terminology," said Central City's SPASH branch coordinator Trudy Peters. "It can be very intimidating to walk in the credit union and not understand the terms being used. It is very empowering for students to have a strong financial vocabulary." Central City operates two other youth-run branches in Marshfield High School and Nasonville Elementary. It also partners with teachers on financial lessons in the classroom.
Officials at Meadville (Pa.) Area FCU and Titusville School District pose with students gathered at the site of the credit union’s first student branch at the high school. (Photo provided by the Pennsylvania Credit Union Association)
On Monday, representatives from Meadville (Pa.) Area FCU and Titusville School District met with students for a groundbreaking ceremony to being construction of the credit union's first student branch, said the Pennsylvania Credit Union Association (PCUA) (Life is a Highway April 21). Eleven students have been selected to operate it. Six others will serve on the board of directors. Students will train during the summer and receive class credits from Titusville High School for their branch responsibilities. The branch expects to open in mid-September. The school also will use the financial education curriculum provided by the National Endowment for Financial Education. Ensuring financial education is a component of the project that made Meadville Area FCU eligible for a $10,000 financial literacy grant from the Pennsylvania Credit Union Foundation, said the PCUA. In Streator, Ill., Streator Onized CU will host a student-run satellite credit union for students and staff during school hours beginning next year at Streator Township High School (STHS) ( April 20). The portable program will be located in a concession stand during morning and lunch hours. Three work program students will operate it. The credit union will provide $25,525 annually for the project. The STHS branch will provide students with an opportunity they've never had before. It will educate students looking to work in finance and be an opportunity for other students to learn from them, said STHS teacher Chris Peterson. Six months ago in Houston, Texas, Smart Financial CU opened an in-school branch in Lamar High School, a business magnet school. This week it reported the branch's operations are on schedule for where they should be at this stage, said the Texas Credit Union League (LoneStar Leaguer April 19). The credit union cautioned that it takes time to reach the younger audience and that credit unions opening branches should not expect instant success. The branch is staffed with five part-time interns, all students, and one full-time outlet manager, Jessica Martinez, who works with the school's teaching staff to develop financial literacy seminars for all students. Smart Financial CU is working on developing products that meet the needs of youth. It has developed its Smart Scholars Checking Account, which has no minimum balance requirements, no service charges and offers bonuses for milestones--such as high grade point averages, and high school and college graduation. The credit union also plans to offer a Family MasterCard to help students slowly establish credit, and financial literacy workshops for students.

Corporate One announces board officers

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COLUMBUS, Ohio (4/22/11)--Three members were elected to the Corporate One FCU board of directors at its annual meeting.
Gerald D. Guy, president/CEO, KEMBA Financial CU, Columbus, Ohio; Jeff Meyer, president/CEO, Three Rivers FCU, Fort Wayne, Ind.; and Janice Thomas, president, PSE CU, Parma, Ohio, were elected to three-year terms. Guy will serve his third term on the Corporate One board. He has been a director since 2002. Guy has been president/CEO of KEMBA Financial CU since 1989. In addition to serving on Corporate One’s board of directors, Guy is a member of the Ohio Credit Union League governmental affairs committee, treasurer/secretary of the Ohio Credit Union Defense Council. Meyer is serving his first term as a Corporate One FCU board member. With 20 years of credit union experience Meyer worked as Three Rivers CU’s executive vice president for nine years and the vice president of lending for four years before becoming president/CEO. Thomas, re-elected to her fifth term, has been on the Corporate One board since 1996, serving as past chair, vice chair and secretary. She has been president of PSE CU since 1991. In a reorganization meeting following the annual meeting, Corporate One’s new board of directors elected its officers as follows:
* Guy, chairman; * Thomas, vice chairman; * John J. Shirilla, president/CEO of Best Reward CU, Walton Hills, Ohio, treasurer; and * Phillip R. Buell, CEO of Superior FCU, Lima, Ohio, secretary.

Rutgers U StudentAlumni CU to close May 20

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NEW BRUNSWICK, N.J. (4/22/11)--The Rutgers University Student and Alumni FCU will close on the campus on May 20, less than a year after its merger with Affinity FCU, Basking Ridge, N.J. The university’s Department of Student Life has determined that the credit union would be violating the terms of its lease to stay in the student center in the wake of the merger The Daily TargumApril 20). The Newark and Camden campus locations of Rutgers University Student and Alumni FCU, also under the Affinity brand, will remain open. Another credit union serving the Rutgers community, Rutgers FCU, has applied to the National Credit Union Administration (NCUA) to change its bylaws to add Rutgers students and alumni to its eligible membership. Rutgers FCU serves university employees. The NCUA approved Rutgers University Student and Alumni FCU-Affinity FCU merger in June. At that time, NCUA said the nearly $3.5 million Rutgers was struggling and in “poor financial condition” News Now July 20, 2010). The university is surveying students on how to use the credit union space. If students want a credit union there, Affinity would have the right to offer a bid, the university said.

Tornado checklist helps CUs prepare

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CHARLOTTE, N.C. (4/22/11)--Over the past week, 15 states were hit by severe tornadoes. All told, 240 tornadoes were reported; 43 people lost their lives. Continuity and disaster recovery planning is often the key to recovery for those hardest hit by disasters, according to Agility Recovery, a provider of business continuity and disaster planning services. Agility Recovery is offering a tornado preparedness checklist to help mitigate the risk of tornadoes. To access the guide, please use the link. Agility Recovery is a CUNA Strategic Services provider.

Regulators confirm Har-Co applies for bank charter

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BEL AIR, Md. (4/22/11)--The $188 million-asset Har-Co Maryland FCU, of Bel Air, has submitted applications to federal banking regulators to convert to a mutual savings bank, the regulators confirmed to News Now. Har-Co Maryland FCU submitted an application to the Office of Thrift Supervision for a savings bank charter on March 25. On March 28, it applied to the Federal Deposit Insurance Corp. for deposit insurance. On Feb. 14, the credit union published a notice to members of its consideration to convert from a federal credit union charter to that of a federal mutual savings bank. On March 16, its board voted to pursue conversion. At that time, Jennifer M. Simmons, interim CEO/chief membership officer at the Maryland & District of Columbia Credit Union Association, said that while the association's board "firmly believes that the credit union charter provides the best vehicle for serving the financial needs of consumers, we do support the right of member/owners to exercise democratic control of their credit union." She added, "The association encourages credit unions considering conversion to make their decisions based solely on the best interest of the members and that the credit union provides full, plain language and timely disclosures to the membership so that an informed decision can be made by the member/owners." Founded in 1955, the credit union serves more than 27,849 members of primarily educational groups. Its notice said it intends “to increase membership and economies of scale” to better serve members and "to preserve its tradition of competitive pricing, plus make it easier to cost-justify adding branches." It also noted a conversion would provide “additional business flexibility” (News Now Feb. 17). Thirty-one credit unions have converted to banks since 1995. No credit unions converted in 2010 and only one converted in each of 2009 and 2008, according to a News Now analysis (Jan. 14).

Corporates CUSO on Fla. gov.s small-biz roundtable

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TALLAHASSEE, Fla. (4/22/11)--The president of a credit union service organization (CUSO) serving two corporate credit unions joined banking and non-profit leaders last week for Florida Governor Rick Scott's roundtable on small business credit. Jim Gallagher, president of Member Business Solutions LLC, joined other leaders at the Florida Governor's Office of Tourism, Trade and Economic Development (OTTED) to discuss ways to encourage favorable lending programs for local small businesses. Member Business Solutions is a CUSO for Southeast Corporate FCU and Georgia Corporate FCU. OTTED is applying to the U.S. Treasury Department for $97 million--the state's share of the $1.5 billion allocated in the 2010 Small Business Jobs Act, which was signed into law in September. Under the act, states participating in the new State Small Business Credit Initiative may use allocated federal funds for programs that leverage private lending to help finance creditworthy small businesses that haven't been able to obtain loans to grow and create jobs. In Florida, the state is encouraging banks, credit unions and other lenders to make loans they otherwise wouldn't make due to riskier profiles that fall just outside a lender's normal underwriting standards. "This initiative could be an important tool to help credit unions alleviate collateral and loan portfolio cap issues now in place," Gallagher said. "Credit unions are playing an important part in the nation's recovery. It's gratifying to see our movement included in discussions on ways to maximize the potential of fund program scenarios included in discussions on ways to maximize the potential of fund program scenarios such as capital access, loan guarantee, participation and venture capital." Gallagher and other panel members emphasized the need to keep administrative burdens to both lenders and borrowers at a minimum. According to Treasury, the State Small Business Credit Initiative is designed to help spur up to $15 billion in lending to small businesses and manufacturers. Funding allocations are available for all 50 states, the District of Columbia and all U.S. territories.

CU System briefs (04/20/2011)

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* DETROIT (4/21/11)--Dante DeMiro, 43, founder and managing director of MuniVest Financial Group and MuniVest Services LLC, Southfield, Mich., pleaded guilty Tuesday in a federal court of five counts of fraud involving more than $10 million he diverted from municipalities, a credit union serving church members, a bank, a school districts and trade unions. DeMiro admitted that from at least March 2009 to September 2010, he falsely promised to invest their funds in certificates of deposit. Instead, he diverted the investment funds to make loans to a jewelry store and repay other investors in a Ponzi scheme. Sentencing is set for July 12. DeMiro faces up to 30 years in prison and/or a $1 million fine (The Muskegon Chronicle April 19 and April 20) … * HARRISBURG, Pa. (4/21/11)--Two people have been elected to four-year terms on the Pennsylvania Credit Union Service Centers Inc. (PaCUSC) board, announced board Chairman Ralph Canterbury. They are Linda Brown, executive vice president, Service lst FCU, Danville, and Brian Waugaman, chief operations officer, Erie (Pa.) FCU. PaCUSC's annual meeting of shareholders will be May 12 in Hershey, Pa. (Life is a Highway April 20) …

Nebraska legislature passes savings promo raffles bill

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LINCOLN, Neb. (4/21/11)--The Nebraska legislature's passage Wednesday of a bill that would enable Nebraska credit unions to conduct savings promotion raffles as incentives for members to save for their financial future was lauded by the Nebraska Credit Union League. LB 524, introduced by state Sen. Amanda McGill (LD-26) of Lincoln, amends the Nebraska Revised Statutes. "We applaud Senator McGill and the Nebraska Legislature for passing LB 524, which will provide Nebraska's 425,000 credit union members with an innovative and fun way of saving money for their financial future," said league President/CEO Scott Sullivan. "By linking savings with prizes, we believe more Nebraskans will choose to save and develop a habit of saving that will provide them financial security and peace of mind going forward. The bill now goes to the desk of Gov. Dave Heineman. If approved by the governor, the bill will go into effect in September. "Our goal is to have a program up and running at participating credit unions in January of 2012," said Sullivan. Michigan, Maine and Rhode Island currently allow savings promotion raffles. A similar bill in Iowa failed to make it out of a House committee after bankers opposed the measure (News Now April 15). In 2009, eight Michigan credit unions, the Michigan Credit Union League, Doorway to Dreams and the Filene Research Institute piloted a "Save to Win" (STW) program. Members of the participating credit unions received one chance to win a grand prize of $100,000 for every $25 they deposited in their STW account. During the first nine months of the pilot, members opened more than 11,000 STW accounts and saved more than $9 million. Today, more than 40 Michigan credit unions offer STW accounts. In February, Michigan credit unions awarded their second $100,000 grand prize since the inception of the program.

CU reassures PETA Promo doesnt urge running of the bulls

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TAMPA, Fla. (4/21/11)--University of South Florida FCU has reassured the animal rights organization People for the Ethical Treatment of Animals (PETA) that a contest to promote savings among its members does not condone cruelty to animals. USF CU dropped all references to the running of bulls in Pamplona, Spain, as part of its “Best Bull” online contest, after receiving a letter from PETA. The credit union’s intention was to tie the promotion to University of South Florida Bulls, according to President/CEO Richard Skaggs. In the contest, which ended Monday, participants produced videos of 60 seconds or less to demonstrate their financial savvy managing money during a tough economy. Skaggs told News Now he believes the credit union’s intentions and its ability to communicate them were clearly reflected in the more than 40 video entries the contest attracted. “All the videos were focused on financial literacy and awareness, being creative, saving and using credit unions vs. banks,” Skaggs said. “I think the videos really give a clear picture of what the contest was about.” The entries are on YouTube and will be judged on originality, creativity and integration of the USF brand. The contest winner can select an all-expense paid trip for two to Pamplona or a cash prize. PETA learned of the promotion from USF students and alumni, according to a press release from the organization. Skaggs received PETA’s letter last week. It expressed concerns about the safety of the bulls during the run in Pamplona. Skaggs told PETA the credit union was unaware of the cruelty involved and will structure the contest differently in the future. The contest winner will be selected next week.

Wine auction raises 270K for kids hospitals

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DANA POINT, Calif. (4/21/11)--The sixth annual California and Nevada Credit Unions for Kids Wine Auction raised a record $270,000 for 11 Children's Miracle Network Hospitals in the two states, announced the event's organizers. The March 25 event in Dana Point, Calif., drew more than 300 attendees from more than 75 credit unions, organizations and hospitals. The wine auction has raised more than $1 million since 2006 for Children's Miracle Network Hospitals. "Achieving $1 million in donations for Credit Unions for Kids over that span is incredible, and greatly reinforces what credit unions are all about--people helping people," said Teresa Freeborn, chair of the Wine Auction Committee and president/CEO of Xceed Financial CU, El Segundo, Calif. At the event, attendees bid on a variety of items, including more than 260 bottles of wine and several travel packages for vacations in Northern California, Hawaii and San Diego.
Click to view larger image The California and Nevada Credit Unions for Kids Wine Auction Committee and representatives from Children’s Miracle Network Hospitals in California announced the auction raised $270,000 for 11 Children’s Miracle Network Hospitals in California and Nevada. (Photo provided by Credit Unions for Kids)
The evening's special guest was Bailey Spoonhower, 9, miracle child from Children's Hospital Orange County, Calif. Spoonhower, with the help of his mother, shared his message of hope after battling rhabdomyosarcoma, a muscle cancer, for three years. He is now cancer free. The Spoonhower family's YouTube channel, which documented the cancer battle, was seen by thousands of viewers. The Wine Auction Committee comprises credit union representatives who work closely with their local Children's Miracle Network Hospital representatives to help raise awareness of the event. Corporate sponsors, who paid all upfront costs associated with the auction, includedthe California and Nevada leagues, CU Direct Corp., CO-OP Financial Services, Financial Service Centers Cooperative Inc, and CUNA Mutual Group. Grand reserve sponsors were: Financial Partners CU, Downey, Calif.; SchoolsFirst FCU, Santa Ana; Xceed Financial CU; AutoNation Direct; and Fifth Third Processing Solutions. Fiserv sponsored the appearance by comedy duo Bermuda Mavericks.

In the media CU perks for the little guy

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MADISON, Wis. (4/21/11)--Credit unions offer five perks for “the little guy,” according to a recent article on, which also appeared in Yahoo! Finance. The article, titled “5 perks for the little guy,” begins by asking, “Are credit unions better than banks?” then explains how credit unions differ from banks in their ownership structure--and how credit union members benefit from that difference. “Since credit unions are not-for-profits owned by their members, they return savings to their membership,” the article says. “For example auto loan rates are usually 2% lower than they are at banks, says Anne Legg, chair of Credit Union National Association’s [CUNA] Marketing and Business Development Council.” Among the perks cited in the article:
* Attend free financial workshops. Most credit unions take financial literacy very seriously. The article cites Landmark CU, New Berlin, Wis., as an example of a credit union that offers free seminars on budgeting and home buying. * Renegotiate loans. They offer lower rates, but truly personalized service has long been a hallmark of credit unions. Legg says most credit unions will discuss loan modifications over the phone. * Find discounts on services, entertainment. Credit unions with large, local memberships often offer discounts on sporting events and entertainment. “We keep offering more every year,” said Todd Pietzsch, spokesman at BECU, Tukwila, Wash. * Take advantage of rewards programs. Many retailers offer rewards programs today, and credit unions are not exception. For example, OMNI Community CU, Battle Creek, Mich., offers cash back rebates on checking, saving and car loans. * Share membership benefits with your family members. Credit unions are typically family oriented, and most offer accounts for every stage of life, from kids accounts to retirement products. Affinity FCU, Basking Ridge, N.J., has a college planning center with advisers to help families with their college savings plans.
To access the full article, use the link.

Banks still hide fees from consumers says U.S.PIRG

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WASHINGTON (4/21/11)--Banks are still hiding their fees from consumers, even the fees mandated by the Truth in Savings Act, says a new study by U.S. Public Interest Research Group (U.S. PIRG). That's why one of the study's key recommendations is to "bank at a credit union, not a bank." The study found that of more than 392 bank branches surveyed in 21 states, fewer than half obeyed the law in fully disclosing their fees to prospective customers. One in four of banks surveyed provided no fee information at all, said U.S. PIRG. The group also reviewed bank fees online at 12 other banks, said its report, "Big Banks, Bigger Fees: A National Survey of Bank Fees and Fee Disclosure Policies." Among the key findings:
* Fewer than half (38%) of the banks complied easily with a researcher request for fee schedules required by the Truth in Savings Act. Only after two or more requests did 55% of the branches provide fee schedules. Nearly one-fourth (23%) refused to comply with the request. Other banks provided "often weighty piles of useless other brochures." * Free checking was available at half the banks, and 29% more offered free checking with direct deposit. "The free accounts are widely available at small and regional banks and credit unions, a finding that has also been obtained by others," said the report.
U.S.PIRG also made these recommendations for consumers:
* Review bank statements and count the fees, especially ATM surcharges and "off-us" fees when making transactions at another bank's ATM. * Examine how many fees you pay and shop around. "Look for better accounts. Bank at a credit union, not at a bank. Credit unions are member-owned, lower-cost alternatives to banks and often offer the same variety of service. It's easier to qualify for membership than most consumers think."
U.S. PIRG, which is a non-profit, non-partisan public interest advocacy organization, also urged the Consumer Financial Protection Bureau to extend the TIS Act requirements to the Internet by requiring banks to post fees in a searchable Web format and to post the most important savings and checking disclosures required by the act in tabular format. To download the full report, use the link.

Kansas CUs elect KCUA officers announce awards

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WICHITA, Kan. (4/21/11)--Kansas credit unions elected officers and honored their peers as 350 representatives gathered in Overland Park last weekend for the Kansas Credit Union Association’s (KCUA) 76th Annual Meeting and Convention.
Click to view larger image During the Kansas Credit Union Association’s (KCUA) 76th Annual Meeting and Convention Millard O. “Bob” Wray, former manager/president of Kansas Highway CU (now Quest CU), Topeka, was named posthumously to the KCUA Hall of Fame. Accepting the award was his son, Gary Wray. From left: KCUA Board Chairman Larry Damm; Gary Wray; and KCUA President/CEO Marla Marsh. (Photo provided by Kansas Credit Union Association)
The two-day event featured industry speakers and educational and networking opportunities. The keynote presentation by Dr. Benjamin Akande, economics professor and Dean at Webster University in Webster Groves, Mo., addressed the new reality of post-recession America. U.S. Rep. Kevin Yoder (R) also addressed the group, sharing insights on the budget debate in Congress and proposed legislation effecting financial institutions. Four credit union leaders were honored at the event:
* Wayne Warfel, president of Wichita (Kan.) FCU, received the Henry Peterson Professional of the Year Award. Warfel was honored for his demonstrated leadership within the Kansas credit union community. * Don Homan, supervisory committee chairman of Frontier Community CU, Leavenworth, received the John Michener Volunteer of the Year Award. Homan was honored for his long-time service and devotion as a volunteer, both to credit unions and the community. * Millard O. “Bob” Wray, former manager/president of Kansas Highway CU (now Quest CU), Topeka, was named posthumously to the KCUA Hall of Fame. Accepting the award was his son, Gary Wray. The award recognized Wray’s dedication and passion as leader, advocate and mentor in the Kansas credit union movement. * John Beverlin, president/CEO of Mainstreet CU, Lenexa, received the Political Involvement Award. Beverlin was recognized for his effort, and involvement in educating both state and national policymakers on the credit union difference. * Mid American CU was also recognized for winning a first-place award in the Desjardins Youth Financial Education Program. The Wichita-based credit union won the award for teaching a financial literacy course as part of a summer youth program in two of Wichita’s most culturally diverse and economically disadvantaged neighborhoods.
KCUA also conducted its annual board elections. Vickie Hurt, president of Quest CU, Topeka was elected to the KCUA board. KCUA executive committee members elected for one-year terms were:
* Chairman Larry Damm, Cessna Employees CU, Wichita; * Vice Chairman Homan; and * Don Napell, Farmers CU, Hays.
Karen Hamit, CEO of Credit Union of Dodge City was newly elected to the Shared Financial Solutions Board. Re-elected to that board were:
* Robert Corwin, president/CEO of Meritrust CU, Wichita; * Brenda Kliewer, manager of McPherson CO-OP CU; * Damm; * Jim Holt, president/CEO of Mid American CU, Wichita; and * Napell.
Shared Financial Solutions is a division of KCUA providing financial products and services to credit unions throughout the Midwest.

SECUs 100000th Bluebird House at governors mansion

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RALEIGH, N.C. (4/21/11)--State Employees’ Credit Union (SECU), Raleigh, N.C., recently placed its 100,000th bluebird house at the home of North Carolina Gov. Beverly Perdue, reaching a milestone in a statewide community improvement project.
Click to view larger image Representatives of the State Employees’ CU (SECU) the Eastern Bluebird Rescue Group recently joined Gov. Beverly Perdue at the governor’s mansion to place SECU’s 100,000th bluebird house. From left: Hope Galunas, SECU member; Tommy Norwood, SECU Bluebird House delivery; Gwen Ferrone, SECU member education; Toretta Snipes, SECU, Butner branch; Perdue; Frank Newell, Eastern Bluebird Rescue Group; Kristye Steed, SECU Warrenton branch; and Anthony Steed, Eastern Bluebird Rescue Group. (Photo provided by State Employees’ CU)
In 2002, SECU partnered with Warrenton, N.C. resident Frank Newell and other volunteers from the Eastern Bluebird Rescue Group to launch a statewide community improvement project, selling birdhouses to benefit the bluebird population in North Carolina. The Bluebird Project was initiated when SECU Senior Vice President Toretta Snipes met Newell, whose passion for saving the dwindling bluebird population was infectious. Soon Snipes and SECU were on board with the goal of selling 25,000 bluebird houses. Today, 100,000 birdhouses later, SECU staffers continue to sell birdhouses for $10, the cost to construct the little homes. “Coordinating this project with Frank Newell and his volunteers at Eastern Bluebird Rescue Group has been such a privilege for me,” said Snipes. “I am inspired by their passion for the bluebirds and the environment, and I am thrilled that SECU’s membership has continued to support this effort in record numbers, allowing us to reach the 100,000 milestone.”

Centris FCU named SBA rural lender of the year

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OMAHA, Neb. (4/21/11)--Nebraska's largest credit union--Centris FCU, based in Omaha--has been named the U.S. Small Business Administration's (SBA) national lender of the year for rural and community loans, announced SBA last week. The award recognizes a lender that assists small businesses in creating jobs during difficult economic times (Omaha World-Herald April 15). The $432 million asset credit union increased its SBA-insured loan total to $6.5 million at the end of 2010, from $390,000 in 2007, said the World-Herald. It added 24 new loans totaling $4 million last year, which is the third-largest volume in the state for the year. SBA-guaranteed loans comprise about 30% of Centris' business lending portfolio. Centris, with 68,000 members, serves members who live, work, worship, or attend school in Douglas, Sarpy or Lincoln Counties in Nebraska or in Pottawattamie County, Iowa.

Dakota CUs see loandeposits growth strong net worth

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BISMARCK, N.D. (4/20/11)--North and South Dakota Credit Unions ended 2010 with a strong combined net worth of 9.97% (9.35% for South Dakota, 10.57% for North Dakota), according to the Credit Union Association of the Dakotas (CUAD). Roughly 91% of credit unions ended 2010 with a net worth above the 7% well-capitalized requirement. This includes 47% of the credit unions that have a net worth in excess of 10%. “Credit unions in the Dakotas generally are well-capitalized and are in sound financial position to serve their members in the coming years,” said Robbie Thompson, CUAD president/CEO. Loan growth for credit unions in the two states also increased in 2010, although by a smaller amount than the previous four years when loan growth was over 10%. Their loan growth in 2010 was 3.29% (0.55% S.D., 5.95% N.D.). “Credit unions in the Dakotas have money to lend and have continued making loans in the current economic environment. They have been and continue to be there for their members even in difficult times,” said Thompson. “However, it is not surprising that overall loan growth is down as this corresponds to the nationwide trend of consumers paying down their existing debt and not taking on new debt,” he added. Since 2006, share deposits in North and South Dakota credit unions have grown more than 34% or $1.04 billion. The national trends of consumers attempting to save more and spend less are reflected in the growth trend in consumer deposits at Dakota credit unions over the past years. However, saving growth slowed in 2010. Dakota credit unions saw a deposit growth rate of 7.94% (6.85% S.D., 9.04% N.D)--lower than the 20+% average annual growth rate they have seen in thepast five years. Credit union membership in the Dakotas has remained virtually unchanged since 2006. For 2010 credit unions membership growth was 0.58% (0.76% S.D., 0.38% N.D.). Membership at the end of 2010 totaled 444,873 credit union members in the states, compared with 438,415 members at the end of 2006. Membership growth from 2006 to 2010 was 1.47%, for an average annual growth of 0.37% (0.31% S.D., 0.44% N.D.). These numbers reflect credit union membership growth rate well below population growth rate in both states during the same period. At the end of 2010, North Dakota credit unions report just over 30% of the population as members (202,181 members out of 675,591total population). South Dakota has just over 29% of the population as members (242,692 members out of 814,180). “Obviously we know that credit unions are the best place for most Americans to perform financial services, yet we still have less than one-third of the population of our states as members and only around 10% of the deposits. We need to create greater awareness of credit unions, the credit union difference, and the benefits of credit unions,” said Thompson.

PCUA letter to editor addresses tax-CUs suggestion

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HARRISBURG, Pa. (4/20/11)--Pennsylvania Credit Union Association (PCUA) CEO Jim McCormack turned around a quick response to a letter to the editor published Monday in a Pennsylvania newspaper. The original letter suggested taxing credit unions. "Credit unions do pay taxes--payroll taxes, real estate taxes and some other property taxes. In addition, dividends paid to credit union members are taxed as ordinary income," said McCormack's letter to the Centre Daily Times (Life is a Highway April 19). "Credit unions' unique tax status allows them to serve all consumers, including those of modest means and those who the bankers find to be unprofitable," McCormack continued. "In addition, credit unions also provide a market alternative that helps moderate bank fees and charges for all consumers by putting downward pressure on all fees and charges by virtue of their presence in the marketplace." He closed by adding, "If you are not a member of a credit union, clearly you should be," and pointed the reader to In the original letter published Monday and entitled "Time to tax credit unions," Richard Wilbur of State College, Pa., advocated credit unions paying "federal and state taxes like every bank does."

EasCorp now well-capitalized members told

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BURLINGTON, Mass. (4/20/11)--Eastern Corporate FCU 's recent voluntary capital subscription program has sold out, which means EasCorp now operates as a "well-capitalized" corporate credit union under the National Credit union Administration's corporate credit union regulation. The announcement was made by EasCorp President Jane Melchionda at EasCorp's 33rd annual meeting in Burlington, Mass. More than 150 credit union officials attended the event. Melchionda also reported that EasCorp and its subsidiary, Vertifi Software LLC, experienced growth in new members and product sales during the most recent four quarters. EasCorp also elected two new directors: Audrey Phinney, president, Bridgewater (Mass.) CU, and Stewart Steele, CEO and treasurer, Quincy (Mass.) CU. They were elected to three-year terms. The meeting's educational program featured keynote speaker Maya Bourdeau of Attune LLC, who spoke about "Psychological Marketing: Bringing the Science into the Art of Marketing." Her presentation discussed how human subconscious an affect a consumer's decision to purchase an item or service and how credit unions can frame their marketing to more effectively deliver their message. A panel on Channel Delivery Strategies featured Douglas Allman, president, NASA FCU, Upper Marlboro, Md.; Sonya McDonald, senior vice president of market development, Randolph-Brooks FCU, Live Oak, Texas; and Jim Morrell, senior vice president, support services, iQ CU, Vancouver, Wash. Moderating the discussion was Craig Roy, senior vice presideht, support services, Digital FCU, Marlborough, Mass.

ACUC Big Time Thursday winners announced

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MADISON, Wis. (4/20/11)--An iPod nano was among the prizes for first-time winners of the Credit Union National Association’s (CUNA) America’s Credit Union Conference (ACUC) & Expo Big Time Thursday contest. The online contest, built around CUNA’s blog, CUNAverse, creates discussion around ACUC keynoters and speaker topics. Each week, CUNAverse blog writers feature a speaker and invite readers to share innovative ideas from their credit unions. Big Time Thursdays have generated posts from all over the U.S. with ideas on youth outreach, Hispanic initiatives, tapping into employee ideas, differentiation and more. Each week a winner is randomly selected from contributors. Prizes tie to the blog post’s theme. First round Big Time Thursday winners, prizes and their ideas include:
* Cheryl Hart won the Apple iPod nano and a copy of Charlie Todd’s book, “Causing a Scene: Extraordinary Pranks in Ordinary Places with Improv Everywhere” for commenting on how TruMark Financial CU, Trevose, Pa., uses a mix of social media and in-person activities to get the word out about financial literacy and more. * Amy Ackerman won a copy of Doug Hall’s book, “Jump Start Your Brain,” and a magic kit to jump start her next big idea for commenting on how 1st MidAmerica CU, Bethalto, Ill., used idea generation techniques to brainstorm ideas on wowing, engaging and having great interactions with members. * Katherine Dyer won a copy of Eric Saperston’s documentary, “The Journey,” on DVD and a $15 Starbucks card for responding with questions she has asked herself to improve as an individual and excel in her role at Hiway FCU, St. Paul, Minn.
Big Time Thursdays will take place weekly through early May. Upcoming conversation topics include best-selling author Dan Pink and using key motivators to drive top performance; and renowned adventurer and West Point professor Alison Levine and surviving and thriving through change.

Western Bridge Corp. charter committee selects board

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SAN DIMAS, Calif. (4/20/11)--The Western Bridge Corporate Charter Committee Monday elected a seven-member board of directors and three supervisory committee members to govern the new corporate entity while it pursues approval of a new charter from the National Credit Union Administration's (NCUA). The corporate plans to submit its new charter application within two weeks. In addition to board director criteria mandated in NCUA's new Corporate Regulation 704, the committee established asset-size criteria that reflect the corporate's broader membership. Two directors must be from credit unions with assets greater than $1 billion, two from credit unions with $100 million-$1 billion assets, and two with assets less than $100 million. There also will be one “at large” director. At least one director must be from a credit union outside of California. The board and supervisory committee will meet within the next two days to elect their respective leadership. Members of both groups will be listed as official sponsors on the new corporate’s charter application, which is on track to be submitted to NCUA within the next two weeks, said Western Bridge Corporate. Elected to the board of directors are:
* Bill Before, chief financial officer (CFO), Spokane (Wash.)Teachers CU, $1.46 billion assets; * Matt Davidson, CFO, Kern Schools FCU, Bakersfield, Calif., $1.35 billion; * Jim Aley, CFO, Honda FCU, Torrance, Calif., $540 million; * Shane Berger, CEO, Beehive FCU, Rexburg, Idaho, $160 million; * Paul Lewis, CEO, San Diego Medical FCU, $71 million; * Elizabeth Lipke, CEO, Bourns Employees FCU, Riverside, Calif., $43 million; and * Charles Papenfus, CEO, Inland Valley FCU, Fontana, Calif., $38 million.
Supervisory Committee members are:
* Francisco Nebot, CFO, SchoolsFirst FCU, Santa Ana, Calif., $8.5 billion; * Mike Harden, chief operations officer (COO), F & A CU, Monterey Park, Calif.,$1.13 billion; and * Donna Young, COO, Vons CU, El Monte, Calif. $372 million.
“These credit union leaders were elected because of their technical capability, and strategic experience," said Mendell Thompson, CEO of America’s Christian CU, Glendora, Calif., and member of the Charter Committee. "Having representation from CEOs, CFOs, and COOs will provide the new corporate the right balance of credit union talent," he said. The Charter Committee will continue to work with the new corporate’s initial board of directors throughout the chartering process. “There is still much work to be done and we will continue to work with the new board as we set a solid foundation on which to build our new corporate,” Ken Burns, CEO, Patelco FCU, Pleasanton, Calif., added. The Charter Committee has more than 50 members representing credit unions in California, Hawaii, Idaho, Oregon, and Washington. It is actively soliciting more members. “We encourage our member credit unions to join the Charter Committee to help us launch this new corporate credit union. We truly value our member input, and seek their advice and council as we continue on the path to a new future,” said Western Bridge CEO Phil Perkins.

N.Y. CUs promote CU difference at state GAC

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ALBANY, N.Y. (4/20/11)--More than 80 credit union leaders attended the Credit Union Association of New York’s Governmental Affairs Conference (GAC) last week in Albany, N.Y.
Click to view larger image During the Credit Union Association of New York’s annual Governmental Affairs Conference last week credit unions and lawmakers met outside the Senate Chamber. From left: Association President William J. Mellin; Marsha Brauer, Clarence Community & Schools FCU, Clarence, N.Y.; Sen. Michael Ranzenhofer (R-Buffalo); and Al Frosolone, Niagara’s Choice FCU, Niagara, Falls, N.Y.
The two-day conference kicked-off with an afternoon compliance and legal update session led by the association’s Senior Vice President and General Counsel Michael Lanotte and Director of Compliance Michael Carter. Day One closed with a welcome reception where attendees reconnected with peers from across the state. Three bill sponsors, Sen. Joseph Griffo (R), chairman of the Senate Bank Committee, and Assemblymen Charles Lavine (D) and Harvey Weisenberg (D), attended the next morning’s legislative briefing. After reviewing key legislative priorities during the briefing and honing their messages, group members converged on the State Capitol and Legislative Office Building.
Click to view larger image Credit union leaders made more than 40 legislative visits during the Credit Union Association of New York’s annual Governmental Affairs Conference last week in Albany, N.Y. Here, participants visit Sen. Jack Martins (R-Long Island), a sponsor of pro-credit union legislation. Pictured from left: Melissa Pagdanganan and Robert Suarez, Bethpage FCU, Bethpage.; Sen. Martins; Robert Nemeroff, Melrose CU, Briarwood; and Michael Lanotte, Credit Union Association of New York. (Photos provided by the Credit Union Association of New York)
During more than 40 legislative visits, credit union leaders promoted the credit union difference and the value credit unions offer their members. They advocated for key issues: preserving credit unions’ earned tax-exempt status; advancing the state charter; limiting information subpoenas; toughening punishment for robbers of financial institutions; gaining access to municipal deposits; establishing Credit Union Development Districts; funding community development financial institutions; and protecting consumers from identity theft, financial illiteracy, predatory credit card practices and abusive mortgage lending. Representatives also shared community-based credit union stories, results from the Credit Union National Association’s Project Zip Code, which matches credit union members by congressional district, state legislative district and county, and the state association’s just released 2010 MORE Report documenting state credit union community outreach efforts. “Events like our GAC are critical to the continued success of credit unions and thereby their members and communities,” said William J. Mellin, the state association’s president/CEO. “Now that it’s over, we will continue to encourage our credit union leaders to keep on advocating and building relationships with their elected representative on their home front.”

National CU Youth Week celebrates 10th anniversary

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MADISON, Wis. (4/20/11)--Celebrating its 10th anniversary this week, National Credit Union Youth Week has grown up in its decade of existence. Started in 2002, youth week was initially a byproduct of the Credit Union National Association’s (CUNA) partnership with the National Endowment for Financial Education, according to Phil Heckman, CUNA’s director of product development and delivery. “NEFE really brought financial literacy to the classroom,” explains Joanne Sepich, CUNA’s National Credit Union Youth Week coordinator. “National Credit Union Youth Week brought more kids into the credit union branches.” In 2004, the National Youth Saving Challenge was added to youth week to generate a measurable outcome for both organizers and participants. The first year of the challenge, 143 credit unions took part, with 1,857 new youth accounts opened. Roughly 15,958 kids deposited a total of about $1.4 million, or $87 per child. That compares with 10,385 accounts opened in 2010 at 384 credit unions. About $24.8 million in deposits was received from 168,438 children, $147 per child, last year. In 2005, CUNA recorded 274 credit unions participating, with 4,451 new youth accounts opened. Deposits were made by 35,071 children, who saved about $4.5 million, or $130 per child. In 2006, about 7,624 accounts were opened at 346 credit unions during National Credit Union Youth Week. Also, 66,269 kids saved about $9.6 million, or $145 per child. In 2007, roughly 9,067 accounts were opened at 393 credit unions. About $10.1 million was deposited by 71,844 kids--$141 per child.
Click for slide show For a look at the past 10 years of National Credit Union Youth Week Posters, click on the slide show.
In 2008, 6,748 youth accounts were opened at 400 credit unions during National Credit Union Youth Week. About $12 million was deposited by 76,524 children, or $157 per child. In 2009, National Credit Union Youth Week expanded to include the entire month of April; 397 credit unions participated with 10,006, new youth accounts opened. Deposits were made by 139,669 children, who saved about $26.5 million, or $190 per child. “The really exciting thing is that all these youth accounts will pay dividends for both the credit unions and the children for decades,” Sepich said about the continued growth of the savings challenge. One of the signature elements of the National Credit Union Youth Savings Week is the annual poster that is displayed in credit unions nationwide, inviting kids to celebrate saving. Sepich says the process of choosing a theme becomes more sophisticated each year, with as many as 1,000 volunteers available to offer input. She credits CUNA’s in-house designers for coming up with something compelling each year. “The challenge is coming up with something that kids are in touch with,” Sepich said. “That can change from year to year.” She specifically cites a “green” theme that was floated one year, but didn’t take off with kids. In 2008, “Got Green” was perfect, and was “posterized” as the year’s theme. Check out the slide show of all the years' posters for youth week. As for the future, Sepich said a mentoring program began this year with representatives from credit unions who took part in the celebration by helping those interested in getting started is just gaining traction. “Each year, we try to make it more convenient and flexible for everyone who wants to participate,” she said. “A variety of the leagues play a big role in helping us do that.”

W.Va. newspaper reports Cheneys appeal for reg relief

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CHARLESTON, W. Va. (4/20/11)--Credit unions need relief from regulatory burden caused "by a crisis we didn't create," Credit Union National Association (CUNA) President/CEO Bill Cheney told attendees at the West Virginia Credit Union League's 75th Annual Meeting last week, reported the Charleston Daily Mail (April 18).
Click to view larger image Credit Union National Association President/CEO Bill Cheney discussed regulatory relief in a session at the West Virginia Credit Union League’s 75th Annual Meeting. (Photo provided by the West Virginia Credit Union League)
Cheney told about 300 credit union leaders meeting in Charleston, W.Va., that about 20 of the largest banks control about 70% of the financial market. "In many cases, they've turned their backs on consumers, focused on themselves, their shareholders. Credit unions have focused on their customers," he said. CUNA's No. 1 goal is to delay implementation of the proposed debit-card interchange-fee rule in the Dodd-Frank Act, Cheney noted. If it isn't delayed, "our free debit cards and checking accounts aren't going to be free," he said, adding credit unions will 'wait until the last minute" before they raise fees. Rep. Shelley Moore Capito (R-W.Va.) and others have introduced a bill in the House to delay the proposed rule. Cheney said. Ken Watts, president of the league, named two other congressmen from the state who have indicated their support for the delay, said the Daily Mail. Cheney also told the conference that lifting credit unions' member business lending cap to 27.5% of assets from 12.25% is a reasonable request. "We're asking Congress and the president to give credit unions the ability to lend as much as $13 billion in the first year to create up to 125,000 new jobs at no cost to the taxpayer," he said, adding the only group opposing the cap lift "is the banks," according to the article. To read the full article, use the link.

CUNA Mutual other states report on damages to CUs

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MADISON, Wis. (4/19/11)--Cutting a swath of devastation last weekend, the storm front that spawned tornadoes in 15 states--92 of them in North Carolina--left people stunned at the devastation and the number of deaths and injuries. But credit unions were luckier than most. As states began their cleanup and took steps toward recovery Monday, credit unions remained largely unscathed. CUNA Mutual Group by early Monday afternoon had "not received any reports from credit unions that suffered damage from this past weekend's tornadoes," said Phil Tschudy, media relations manager. However, he cautioned that the insurer was "contacting leagues and its field staff in the impacted areas to make sure that is the case." North Carolina and Virginia credit union damages are reported in a related story (See News Now's "CUs in North Carolina, Virginia assess tornado damages"). News Now also canvassed other state associations to see how credit unions fared in their states. In Mississippi, Members Exchange CU, which is based in Jackson had a branch office in Clinton that was without power and phone service on Friday, said Charles Elliott, president of the Mississippi Credit Union Association. He told News Now that "no credit unions or staff received any damage we are aware of." However, "we do not have information concerning any members at this time." In Alabama, "it appears that no credit unions were affected in the storm area. However, some members were," said Mike Bridges, vice president of marketing and communications at the League of Southeastern Credit Unions, which covers Florida and Alabama. He noted that a credit union in Montgomery has one member who was hit hard, but he was still trying to confirm circumstances. The league is trying to figure out what credit unions are doing for members, if anything, he told News Now. The league's credit union foundation is working to put together a plan for disaster relief. The Kansas Credit Union Association had not heard of any damage to credit unions in its storms, but it was contacting credit unions to make sure. "We had our annual meeting this weekend (Thursday-Sunday) so a lot of credit union people were in Kansas City," said Susan Dyer, communication specialist. Other states also reported tornadoes and funnel clouds. They include Texas, Arkansas, Oklahoma, Kentucky, Louisiana, Missouri, Illinois, Georgia, South Carolina and Maryland ( April 18). Later in the week, News Now will follow up with more coverage on these states and how credit unions are assisting members and their communities. Meanwhile, another weather system is building toward the Midwest and expected to present a moderate risk of tornadoes, high winds and hail today in parts of Missouri, Arkansas, Illinois, Indiana and Kentucky.

CUs in N. Carolina Virginia assess tornado damages

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MADISON, Wis. (4/19/11)--Credit unions in North Carolina and Virginia appear to have escaped major damage from the weekend’s tornadoes, but the members they serve were almost certainly affected. Calling the path of destruction and death from Saturday’s tornadoes in North Carolina “horrible,” Raleigh-based State Employees' CU (SECU) CEO Jim Blaine said he felt lucky his credit union emerged from the storm system with relative minor damage. Blaine said one branch roof was damaged, forcing the branch to close temporarily, and eight ATMs were inoperable, but otherwise the credit union was at full service throughout the state on Monday. “They say we all know each other here in North Carolina, so I’m sure we have employees who know or are related to people who were affected, but I’ve heard no direct stories as of yet,” Blaine said. “Given the number of tornadoes that tore through state, we’re lucky to have gotten through it with the amount of damage that we experienced.” One tornado touched down a half mile from new offices of the North Carolina Credit Union League, which had relocated earlier in the week, but the league reported no damages. Virginia Credit Union League Rick Pillow said no credit unions in that state reported damage, and league members were awaiting further reports to determine if victims were in need of special services. North Carolina Credit Union League President John Radebaugh said that no other state credit unions had reported damages to the league or indicated special services were needed as of late Monday. In North Carolina, the last reported death toll from the storms was 21, with at least 130 more injured. Half of the North Carolina fatalities were in Bertie County, a rural county about 120 miles northeast of Raleigh that has just 21,000 residents. Preliminary reports indicate about 500 homes destroyed and more than 1,000 damaged. Officials say that more than 1,000 families will be homeless in the state, according the American Red Cross. Red Cross workers sheltered more than 500 people over the weekend. Five tornadoes touched down in Virginia, causing major damage, according to the National Weather Service ( April 18). Preliminary reports indicate that 332 structures were damaged, 35 destroyed, and 122 severely damaged. Five people in Virginia were reported killed as a result of the storms. For information related to other states, see related story in System News, "CUNA Mutual, other states report on damages to CUs."

SECU tellers help members switch to checking

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RALEIGH, N.C. (4/19/11)--State Employees’ CU (SECU) is helping members make the switch to credit union checking accounts through a personalized teller initiative. Since the initiative began, SECU tellers have educated 11,000 members on the benefits of the credit union’s checking product and 750 made the switch. The project came about when SECU tellers communicated to management that many members without a checking account at the credit union had indicated it would be too inconvenient to move to the credit union. SECU’s Senior Vice President of Corporate Projects Patty Munns organized a focus group of teller services managers to develop the program. SECU teller services managers from throughout the state met in early February to learn about the program details. The project kicked off March 1. As they serve members at their stations, tellers identify members without SECU checking and educate them on the product. But the key feature of the SECU “Switch” is the opportunity to work individually with the same teller, who guides a member through the step-by-step process of moving a checking account from another financial institution to SECU. “This checking switch project is a great initiative for our teller staff as they are the first point of contact for members visiting the branch,” Munns said. “Tellers interact daily with the membership and have a clear understanding of the services they (members) use. The ultimate goal is to help members save money on the products they need and want from their financial institution without compromising convenience or service. The switch process can be hassle-free and SECU tellers are proving that on a daily basis.”

Veridian CU tests cashless branch to woo Latinos

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DES MOINES, Iowa (4/19/11)--A cashless branch in a Des Moines social service facility is helping Veridian CU build trust and grow membership within the Latino community. Veridian CU opened the cashless branch in the Hola Center to test the market in a neighborhood where check cashers and payday lenders are more common than traditional financial institutions (Des Moines Register April 9). The branch consists of a single cubicle staffed by a member services representative (MSR). The MSR answers basic questions about checks, ATMs, and remittances and can provide the same transactions--except deposits and cash withdrawals--as a regular branch. The Latino population has grown by 84% in Iowa in the past decade. About 152,000 Latinos currently live in the state. A large portion of them are unbanked, said the newspaper. But Veridian has begun to establish a presence in the Des Moines Latino community. The credit union also sponsors the 37-team International Soccer League, which is largely Hispanic. The branch at the Hola Center will offer financial literacy classes. Coopera Consulting, a firm owned by the Iowa Credit Union League, also helps credit unions reach Latinos, the article said. The firm advises credit unions to hire bilingual staff, offer low-fee remittance programs that allow members to send money bank their home countries, make loans to non-resident taxpayers, and package loans for Latino events.

Insurance exec to head Michigans OFIR

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LANSING, Mich. (4/19/11)--Michigan Gov. Rick Snyder Friday appointed R. Kevin Clinton, a former insurance executive, as commissioner of the state's Office of Financial and Insurance Regulation. Clinton is the former president/CEO of American Physicians Capital Inc., a medical liability insurer in East Lansing. He replaces Ken Ross, who left the position Friday (Crain's Detroit Business and Lansing State Journal April 15). "Kevin Clinton brings a wealth of insurance experience to the post of OFIR commissioner, and we are looking forward to bringing him up to speed on the needs of Michigan's 322 credit unions," said Michigan Credit Union League CEO David Adams. "We've had a great working relationship with his predecessor Ken Ross and John Kolhoff, deputy commissioner for the credit union division, and hope to continue the mutually beneficial dialogue among the regulatory agency, the trade association and our credit unions." Clinton said his top goal is to reduce insurance rates by fostering more competition among insurance companies and reducing unnecessary regulations. Snyder said Clinton's first priority would be to "make sure consumers are protected by making sure financial institutions are sound" and that Clinton would lead the state's effort to "eliminate burdensome regulations that are preventing the industry from growing." OFIR oversees and regulates credit unions, banks, insurance companies and agents, health maintenance organizations, investment advisors, consumer lenders and securities broker-dealers and agents.

Illinois Director Meza appointed to NASCUS Board

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ARLINGTON, Va. (4/19/11)--Robert Meza has been appointed to the National Association of State Credit Union Supervisors (NASCUS) Board of Directors by NASCUS Chairman Tom Candon. Meza is director of financial institutions for the Illinois Department of Financial and Professional Regulation. He is filling an unexpired term ending in September that was held by Michigan Commissioner Ken Ross, who left the Michigan agency Friday. Meza was appointed director of Illinois’ Financial Institutions Division in February 2008. Prior to his work at the agency, he was with Williams Acosta PLLC, a Detroit-based law firm. He also served in various leadership roles as an attorney with the U.S. Department of Education’s Office for Civil Rights in New York and the Chicago Transit Authority. With one of the largest state-chartered credit union communities Meza will offer a broad perspective to the board, said NASCUS President/CEO Mary Martha Fortney.

Members United building corporate of the future

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WARRENVILLE, Ill. (4/19/11)--Members United Bridge Corporate FCU is "now beginning the formal process of building your new corporate of the future," its members were told Friday. John Fiore, chairman of the Members Advisory Council (MAC) for the Warrenville, Ill.-based corporate, posted a letter to member credit unions Friday announcing that the bridge corporate received a letter from the National Credit Union Administration's (NCUA) Office of Corporate Credit Unions, which stated it has no objection to Members United Bridge's capital plan. The corporate filed its capital plan with NCUA on March 18. NCUA's letter said that based on the information provided it would have no objection to the plan. "We are working with our attorneys to complete the private placement memorandum," said Fiore, who advised members to watch the MAC website for continuing developments, as well as the "posting of various documents as they become available." The new corporate credit union will retain the assets, people, processes, products and services of Members United Bridge.

Cheney to address N.Y. CUs convention

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ALBANY, N.Y. (4/19/11)--Credit Union National Association (CUNA) President/CEO Bill Cheney will address New York credit union leaders June 3 at the Credit Union Association of New York's Annual Meeting and Convention in Lake Placid, N.Y. The convention, which runs June 2-5, has as its theme: Credit Unions: Standing Tall. Cheney will report on the status of:
* Debit interchange; * The Consumer Financial Protection Bureau; * Corporate stabilization; * Supplemental capital; * Member business lending; * The National Credit Union Administration's budget and oversight, and more.

West Virginia league announces officers awards

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CHARLESTON, W. Va. (4/19/11)--The West Virginia Credit Union League elected Dave Van Middlesworth as chairman of its board of directors. The elections were conducted after the league's 75th annual meeting, which was held Saturday in Charleston, W.Va. Van Middlesworth is a director of the Eastern Panhandle FCU in Martinsburg, and he has served on the league board since 2002, said the league. Other officers elected include:
* First vice chairman, Donna Gordon, Mercer Co. WV FCU, Bluefield; * Second vice chairman, Mike Tucker, West Virginia Central CU, Parkersburg; * Treasurer, Doris Cunningham, Members Choice WV FCU, Charleston; and * Secretary, Edgar Cosner, The United FCU, Morgantown.
Also at the meeting, Terry Richardson, Pioneer FCU, Charleston, received the league's highest annual recognition of a volunteer, the William Bryan Hawkins Award. Receiving the Pacesetter Award was Carolyn Neale, National Employees FCU, Bluefield. Neale has been involved in the credit union movement since 1955. The award symbolizes excellence among paid credit union staff in the state.
Click to view larger image West Virginia Credit Union League's outgoing Board Chairman Tom Walker, left, presented the gavel to newly elected Chairman Dave Van Middlesworth, Eastern Panhandle FCU, Martinsburg, during the league's annual meeting Saturday in Charleston, W.Va.
Click to view larger image West Virginia Credit Union League's top honors Saturday went to Carolyn Neale, National Employees FCU, Bluefield, recipient of the Pacesetter Award, and Terry Richardson, Pioneer FCU, Charleston, who received the William Bryan Hawkins Award for volunteers. (Photos provided by the West Virginia Credit Union League)

CU System briefs (04/15/2011)

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* ALBUQUERQUE, N.M. (4/18/11)--Sandia Laboratory FCU (SLFCU), based in Albuquerque, N.M., reported on its website Friday that members and nonmembers have received phone calls and e-mails saying their cards or accounts will be deactivated if they don't provide sensitive information such as usernames and passwords. The calls and e-mails specifically mentioned SLFCU's name. Members also reported receiving fraudulent e-mails saying their SLFCU account "has been hacked" and the account has been temporarily put on hold. The $1.6 billion asset credit union and the state attorney general's office warned that anyone getting the message should not respond and that the credit union would not solicit information through phone calls or e-mail ( April 14) … * WASHINGTON (4/18/11)--Two former employees of Washington, D.C.-based Clara Barton FCU pleaded guilty Thursday in a federal court in Washington to defrauding the credit union of $675,000 in a loan scheme (Department of Justice Documents April 13). Tracy S. Kemper, 35, Temple Hills, Md., a former loan processor, and Tiffany A. Samuells, 34, Greenbelt, Md., a former member services representative, each pleaded guilty to one count of conspiracy to commit bank fraud and agreed to pay restitution and forfeit at least $519,028. The pair issued loans to friends, relatives and associates in exchange for receiving a kickback or part of the loan proceeds from the borrowers. However, some borrowers stopped paying on the loans and the two were forced to use kickback money for minimum payments on the loan. The problem was discovered when the tiny credit union merged with Pentagon FCU in November 2008. The credit union served current and former employees of the American Red Cross and their families … * St.LOUIS, Mo. (4/18/11)--The Missouri Credit Union Association (MCUA) announced Friday that John McKechnie, senior vice president of Washington, D.C.-based Total Spectrum, will join MCUA's credit union advocacy team in Washington, D.C. He will work with MCUA Vice President of Federal Legislative Affairs Amy McLard to lobby credit union issues before U.S. Congress and other governmental entities and will advise MCUA in developing educational programs to motivate credit union professionals and volunteers to increase their involvement in the political process. McKechnie previously was director of public and congressional affairs at the National Credit Union Administration for five years and was a former senior vice president of legislative affairs staff at the Credit Union National Association … * HARRISBURG, Pa. (4/18/11)--Fran Muto, longtime president/CEO of People First FCU, Allentown, Pa., announced he will retire, effective June 30. His credit union career began in 1974 after working as an examiner for the National Credit Union Administration. For the past 36 years, Muto led the People First from a $4 million asset, single sponsor organization to a full-service, community-chartered credit union with more than $374 million in assets. He has served on the boards of the Pennsylvania Credit Union Association, Associated Credit Bureau Services, Card Services for Credit Unions, and Member Business Financial Services. Muto is a past president of the Lehigh Valley Chapter of Credit Unions. He will be honored by PCUA as its Professional of the Year at its annual convention next month in Hershey, said PCUA. Susan Phillips has been named as acting president/CEO (Life is a Highway April 15) …

Cyber threats skyrocket in volume savvy

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MOUNTAIN VIEW, Calif. (4/18/11)--Cyber threats have skyrocketed in volume and sophistication, with more than 286 million new threats last year and several new megatrends, including targeted attacks, social networking threats, mobile device security issues and the proliferation of attack toolkits--according to a new security study. Credit unions and their members can be impacted by cyber threats in any of these areas, but with the trend in credit unions to offer more social networking interaction with members and online banking for mobile devices, credit unions will need to be even more vigilant about their keeping their members' data secure and educating members about these security threats. Symantec Corp.'s Internet Security Threat Report, Volume 16 highlights what the security management solutions company terms as "dramatic increases in both the frequency and sophistication of targeted attacks on enterprises, the continued growth of social networking sites as an attack distribution platform; and a change in attackers' infection tactics, increasingly targeting vulnerabilities in Java to break into traditional computer systems." The report also explores how attackers are exhibiting a notable shift in focus toward mobile devices. Targeted attacks in 2010 increased against a diverse collection of corporations and government agencies, and a surprising number of smaller companies, said Symanteck. Often, the cyber crooks researched key victims in each corporation and used tailored social engineering attacks to gain entry. Many attacks--because they were targeted--succeeded--even though the organization had basic security measures in place. Many obtained personal information that could be used in an identity theft. The report noted that hacking breaches in 2010 resulted in more than 260,000 identities exposed per breach. Social network platforms attracted a large volume of malicious software or malware. One technique cyber crooks use on social networking sites involves shortened addresses of websites or URLs. The abbreviated URLs make it more efficient to share a link to a complicated web address in an e-mail or on a web page. But they also make it easier to reel in data theft victims. In 2010, attackers posted millions of these shortened links on social networking sites to trick victims in phishing and malware attacks. Symantec said the abbreviated URLs "dramatically" increased the rate of successful infection. The report also found that attackers overwhelming leveraged the news-feed capabilities on popular social networking sites to mass-distribute attacks. Last year, 65% of malicious links in news feeds observed by Symantec used shortened URLs. Of those, 73% were clicked 11 times or more, with 33% receiving between 11 and 50 clicks. Another trend is an increase in attack toolkits--software programs used by novices and experts to launch widespread attacks on networked computers. These are increasingly targeting weakenesses in the Java system, which accounted for 17% of all vulnerabilities affecting browser plug-ins last year. The number of measured Web-based attacks per day rose by 93% last year. Two thirds of the activity observed by Symantec was directly related to attack kits. The popularity of mobile platforms has grabbed attackers' attention, and Symantec said it expects attacks on these platforms to rise. In 2010, most attacks against mobile devices took the form of Trojan Horse programs masquerading as legitimate applications or "apps." Attackers can bypass new security architectures by attacking inherent vulnerabilities in the mobile platforms' implementation. Symantec said these are commonplace. It documented 163 vulnerabilities last year that attackers could use to gain partial or complete control over devices running on mobile platforms, and these infected hundreds of thousands of devices. Other findings:
* 93% hike in Web-based attacks; * 260,000 identities exposed per breach; * 14 new zero-day vulnerabilities; * 6,253 new vulnerabilities in 2010; * 42% more mobile vulnerabilities; * One botnet with more than a million spambots; * 74% of spam related to pharmaceuticals; and * Seven cents to $100 per credit card--the price for credit card data on underground forums. Factors dictating price include the rarity of the card and discounts offered for bulk purchases.

Mazuma CU sponsors Suze Ormans visit

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KANSAS CITY (4/15/11)--Mazuma CU, in partnership with the Missouri Credit Union Association, was among the sponsors of personal finance guru Suze Orman’s appearance at the Overland Park Convention Center in Overland Park, Kan., March 22. Orman, on a nationwide tour promoting her latest book, “The Money Class,” was in the Kansas City area as a guest speaker for local radio station, 98.1 KUDL FM, as part of its WomenWise Luncheon Series. Many businesses partnered with the radio station, but Mazuma CU was the only financial institution to sponsor Orman’s visit. “We felt it was important that a credit union sponsor Suze’s visit to the Kansas City area, since she is an advocate of credit unions,” said Rob Givens, president/CEO of the $420 million-asset financial institution. Orman, who works with National Credit Union Administration (NCUA) on educating the public about the similarities between NCUA and FDIC protection, has promoted the credit union difference and the advantages of using a credit card from a credit union. Credit union credit cards are typically lower in interest rates and fees. Several MCUA-affiliated credit unions attended the event, providing information to the public regarding the credit union difference. Mazuma CU conducted a drawing for 10 pairs of tickets for Orman’s appearance and gave them to members and an additional pair to a non-member. More than 1,100 members and consumers entered the drawing. Orman spoke to an audience of about 500 people. Due to the current economic situation, it may be necessary for people to lower their expectations of owning a home, she said. People should be realistic about their finances and, most important, must create their own version of the “New American Dream,” she said. In “The Money Class,” Orman wrote that many people fear the unknown because they are not sure what works for them now. “The truth is, you must learn to trust yourself. To follow a path that is right for you, to make choices that are realistic for you and your family,” she wrote.

Ohio league honors state award recipients

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COLUMBUS, Ohio (4/18/11)--In front of nearly 500 peers, Ohio credit union leaders were honored during InVest48, the Ohio Credit Union League’s annual conference, for their contributions to the movement, their credit unions and the communities they serve. Highlighting the 2011 awards were this year’s Claude Clark Political Inspiration Award Winners: Tom Furrey, CEO of Western CU, and Greg Kidwell, CEO of Members First CU, both of Columbus. In 2010, inspiration award winners Furrey and Kidwell helped elect a credit union supporter to Congress, Rep. Steve Stivers (R-Ohio). Their support helped Stivers win election to the 15th congressional district, where he is now a strong credit union advocate on the influential House Financial Services Committee. Also, both Furrey and Kidwell have led strong Political Action Committee campaigns at their credit unions, raising a combined total of $6,000 last year. Eileen Meeker of AurGroup Financial CU, Fairfield was introduced as the Professional of the Year. Meeker has helped raise tens of thousands of dollars and awareness for causes, including Children’s Miracle Network Hospitals, Shared Harvest Food Bank, United Way, and the West Chester Community Back-Pack Program. Her passion includes providing financial education to the underserved and unbanked, and to students in Butler County. Desjardins Youth Financial Education Awards were presented to:
* Classic FCU, Amelia, which hosted Reality Store events for more than 300 students on the importance of managing money. * Fiberglas FCU, Newark, and Harvest FCU, Heath, which joined forces to introduce Mad City Money to high schools, and to inform educators and parents about the importance of financial education.
Dora Maxwell Social Responsibility Awards were presented to:
* Wayne County Community FCU, Smithville, which hosted Shredding Hunger, where members could shred a box of documents for every bag of groceries donated. More than 5,000 pounds were shredded and enough food was collected to stock two local food pantries. * KEMBA Financial CU, Columbus, which created “KEMBA Cares,” to provide community partnerships. The credit union turned twice-a-year, all-day staff meetings into outreach opportunities by closing its offices and investing time in the community.
Communicating Arts CU, Cincinnati, received the Louise Herring Award for Philosophy in Action. Communicating Arts CU celebrated its 70th anniversary by offering a 7-month share certificate at 7% APR. The intent was to both reward members for their dedication to the credit union, and incent them to develop a savings plan. Cutting-Edge Marketing Brilliance Awards were presented to:
* Ohio University CU, Athens, which increased its membership by 2.57% with its “I Love O-U-C-U” campaign. Members referred family and friends, earning them credit union “points” and entry for prizes. * Ohio HealthCare FCU, Columbus, which engaged its statewide professional field of membership to create buzz about the benefits of the credit union through a member contest, “Next Top Credit Union Member.” Members provided video testimonials about how the credit union has made a difference in their lives.

CUNAs ACUC aims to deliver high-impact program

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MADISON, Wis. (4/18/11)--The 2011 America's Credit Union Conference & Expo (ACUC), hosted by the Credit Union National Association, June 19-22 in San Antonio, Texas, aims to deliver a high impact program. The key innovation and leadership event for credit unions, this year's conference theme is Big Time: Big Ideas & Big Opportunities. In addition to keynote speakers Dan Pink, Alison Levine, Eric Saperston, Doug Hall and Dan Heath, CUNA is announcing ACUC will feature several thought leaders. They include:
* Strategist John Lass, speaking about "Supplemental Capital." Lass will present research identifying successful financial strategies for achieving sustainable credit union growth. * Author and former chief customer officer Jeanne Bliss, speaking about "Extreme Customer Loyalty in Good Times and Bad." Bliss will discuss an elite few companies who have true advocates, and five decisions of beloved and prosperous companies. * Marketing guru Scott Stratten, speaking on "UnMarketing." Traditional marketing methods are leading to diminishing returns and disaffected customers. Stratten will show how to unlearn the old ways and consistently attract and engage the right customers--by creating a relationship with members and becoming the logical choice for their needs. * Corporate coach and author Lee Silber, with "The Undercover Speaker. Based on the hit CBS show, "Undercover Boss," Silber's presentation will share examples of credit union executives and employees who do things right. He will talk about perseverance, positive acts of exceptional service, teamwork and cooperation, and how small things make a difference. * Performer Charlie Todd, with "Causing a Scene." The founder of Improv Everywhere, a scene causing performance company whose more than 80 missions has featured thousands of undercover agents, will share how credit unions can tap into their creativity and stand out in a crowded market. * CUNA economists Bill Hampel and Mike Schenk, speaking on "The Economy and its Impact on Credit Unions." They will provide an outlook of the U.S. economy for the rest of 2011 and discuss how the future will impact the financial operations of credit unions for the years ahead.
New this year: CUNA is partnering with CUNA Mutual Group to offer CUNA Mutual's Discovery Conference sessions at ACUC. "ACUC is consistently lauded for its innovative, forward-thinking agenda and unmatched speaker line up," said Bill Cheney, president/CEO of CUNA, who promised the collaboration will be "a one-of-a-kind experience." According to Jeff Post, CUNA Mutual president/CEO, "The credit union movement faces unprecedented challenges, but also opportunities. Best practices and fresh thinking are more relevant than ever." ACUC will continue its exclusive Executive Series, which will allow credit union CEOs and executives to network and hear from leading business authors. Also, special pre- and post-conference meetings will include a Latino Membership Growth Forum and a Small Credit Union Roundtable. Discovery breakout session topics include:
* The Revolutionary Role of Leadership; * Principles of Highly Effective Credit Unions; * Essential Drivers of Member Loyalty; * Helping Members Climb Back from the Financial Crisis; * Health Care Reform and the Compliance Maze; * The Competitive Opportunity for Small Business Services; * Boards of Directors and Governance; * Mobile Technology; * A View to the Future of Credit Unions With Gen Y; * Lending Regulations Update; * Business Services Risk Management; * Social Media and Social Marketing; * Amazing Sales and Service Cultures; * Digital Culture and Strategy; * Strategy and Your Financial Statements; * Constructing a New Vision for Lending; and * Top Fraud Trends in 2011.
ACUC's five keynote speakers will address these topics:
* Dan Pink, best-selling author of A Whole New Mind, "Drive; What the Science of Motivation Can Teach Your About High Performance. * Dan Heath, entrepreneur who has worked with key organizations such as Harvard Business School and Microsoft, "Switch: How to Change Things When Change is Hard." * Alison Levine, adventurer,"Beyond Boundaries." * Doug Hall, founder/CEO of Eureka! Ranch, "Innovative Engineering: How to Innovate and Grow Your Credit Union." * Eric Saperston, who convinced friends to ask some of the world's most powerful people out or a cup of coffee, "The Journey: Lessons from America's Most Influential Leaders."
"This event has great energy," said CUNA Board Chairman Harriet May. "We give credit union decision makers unique access to big thinkers and big ideas in a setting that fosters leadership, unity and strength. From dealing with regulatory challenges to recalibrating for a changing economy to equipping your credit union to seize its greatest opportunities, ACUC delivers a powerful agenda."

42 CU professionals certified as CUDEs

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MADISON, Wis. (4/18/11)--Forty-two credit union professionals earned their Credit Union Development Educator (CUDE) designation after a week of intensive training at the Lowell Center on the University of Wisconsin campus in Madison, Wis.
Click to view larger image Forty-two credit union professionals were led by eight facilitators and mentors through Credit Union Development Education (CUDE) training April 6-13 in Madison, Wis. Pictured are the graduates of 2011 DE Training outside the World Credit Union Center in Madison. (Photo provided by the National Credit Union Foundation)
During the program they were guided by eight facilitators and mentors and participated in group exercises, were encouraged to ask questions of visiting speakers, and completed team projects proposing solutions for credit unions to help alleviate or eliminate challenging situations. The mission of the CUDE program is to promote credit unions’ social responsibility and domestic and international development through interactive adult education and professional networking. The National Credit Union Foundation (NCUF) is the primary sponsor of the Development Educator (DE) program. Support is provided by CUNA Mutual Group, the Credit Union National Association (CUNA), the World Council of Credit Unions, state foundations and leagues. “We refresh the studies every year, incorporating challenges credit unions face today while continuing to provide critical lessons in cooperative principles and credit union philosophy,” said Lois Kitsch, DE facilitator and national program director for NCUF. “It is timeliness that we strive for in the entire DE training experience as participants work through critical issues that include interchange legislation, mergers and small credit unions, growth plan, financial capability plans, 2012 as the ‘Year of the Cooperative,’ and credit union development in Iraq.” “The DE experience has reignited my passion for working in the credit union movement,” said Meghann Dawson, class attendee and instructional design manager at CUNA. “It has provided a solid foundation with cooperative principles, credit union philosophy and global development issues. I believe that having the knowledge provided by DE combined with the network of other CUDEs, I will now be able to play a more purposeful role in the current and future success of the industry.” For a list of the CUDE graduates use the link.

Maine committee tables state interchange vote

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PORTLAND, Maine (4/18/11)--A Maine legislative committee tabled a vote April 8 on a state interchange bill for three weeks and directed interested parties to participate in a stakeholders’ group meeting held last Friday. At the work session April 8, on LD 1251--An Act To Prevent Credit Card Company Unfair Trade Practices, an anticipated debate and vote by the Insurance & Financial Services Committee did not happen, according to the Maine Credit Union league (Weekly Update April 15). “Many members of the committee seemed inclined to agree with our position so we were cautiously optimistic that the majority of the committee would vote in opposition to the bill,” said Quincy Hentzel, league director of governmental affairs. “Although we were disappointed that no vote occurred, we will continue to work to have this bill defeated.” “Credit unions have done a great job stating our position and communicating our opposition with members of the committee, and we anticipate coordinating additional, aggressive grassroots communications once the work session is rescheduled,” league President John Murphy said. “We intend to continue to outline the significant, negative impact that this legislation would have on credit unions and, ultimately, consumers,” Murphy added. “We have made that clear from the beginning and will remain focused on providing factual information to all parties,” he stated. The league will provide updates on the status of the bill and the date for the work session as soon as information becomes available. The Credit Union National Association (CUNA) opposes a proposal in Congress capping interchange fees and has told federal lawmakers that such action would harm consumers by driving up costs of debit cards, limiting consumer options, and harming competition and technological innovation. Interchange fees allow business costs, including the risk of consumer nonpayment, to be shared by the payments participants, CUNA said.

Ten receive scholarships to global womens forum

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MADISON, Wis. (4/18/11)--The Global Women’s Leadership Network, co-founded by World Council of Credit Unions (WOCCU) and the Canadian Co-operative Association (CCA), announced Thursday it awarded 10 scholarships for its 2011 Global Women’s Leadership Forum. Network members and the CCA funded the scholarships to empower and support women credit union leaders worldwide. “The network enhances the development of credit unions around the globe by focusing on women professionals and leaders,” said Jo-Anne Ferguson, CCA senior director of the international development program. She added the network enables “women from rich and poor countries to meet their common commitment--professional development and learning, improved credit unions and personal enrichment.” This year’s scholarship recipients include: Eliane Jose Ferreira, Brazil; Elena Koleda, Belarus; Mercedes Castillo, Philippines; Amilvia Rios Martinez, Colombia; Veronica Muthoni Muchim, Kenya; Edith Concepcion Perez Gauto, Paraguay; Anna Chepotib Renoh, Kenya; Rosa Aminta Perez Guido, Nicaragua; Success Swanzi Mbiliyawaka, Malawi; and Rose Angeyando, Uganda. All scholarship recipients will receive a one-year membership to the network; registration to attend the forum July 24, and registration for the World Credit Union Conference, July 24-27, both in Glasgow, Scotland; and additional funding to help cover travel costs. The Global Women’s Leadership Network formed in 2009 to promote professional and personal development of credit union women around the world through peer-to-peer networking, social media and educational workshops. The network “is dedicated to sharing resources to make a difference in our member's communities,” said Susan Mitchell, CEO of Mitchell, Stankovic Associates, and a network member. “Through scholarships, members who might not be able to attend without financial support are given an opportunity to join us at the forum where we all learn from each other.” After the forum, the Worldwide Foundation for Credit Unions will host a golf tournament July 28 at The Carrick on Loch Lomond in Scotland to benefit the network. Proceeds will help fund future scholarships and development programs designed to alleviate poverty by empowering women around the world with access to financial services. For more information, use the links.

Minn. CU committees recognize two volunteers

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BLOOMINGTON, Minn. (4/18/11)--The Minnesota Credit Unions for Kids (MnCU4Kids) committee and Minnesota Family Involvement Council (FIC) recently honored two individuals for their contributions to their respective committees. Steve Oien of Minnco CU, Cambridge, and Bridget Moeller of Greater Minnesota CU, Mora, received their volunteer awards April 9 at a banquet during the Minnesota Credit Union Network’s (MnCUN’s) 2011 Annual Meeting and Convention. Oien has served as president/CEO of Minnco CU for nearly 20 years. He joined the MnCU4Kids committee in 2003 and was co-chair from 2004-2008. Oien received the Volunteer of the Year honor for his active involvement in the committee’s golf tournament, Annual Meeting, and Bowl-O-Rama subcommittees and more. This is the third consecutive year Oien has received the MnCU4Kids Volunteer of the Year Award. Last year, Minnesota raised more than $168,000 for Gillette Children’s Specialty Healthcare in St. Paul, which has outreach clinics statewide. Fundraising for CU4Kids takes place in all 50 states. Moeller, vice president of human resources/training at Greater Minnesota CU, earned the Minnesota Family Involvement Council’s Outstanding Volunteer Award for her service on the committee. Moeller joined the FIC in 2005 and has served as vice chair since 2007.

Money Mission scholarship winners announced

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MADISON, Wis. (4/18/11)--Money Mission’s first scholarship giveaway in late March awarded three Wisconsin high school seniors a total of $12,000 in scholarships. Recipients included:
* Nathan Carpenter, Harbor CU, Green Bay; * Anquette Kirksey, Heartland CU, Madison; and * Obiageli Nwabuzor, Heartland CU.
Each student received a $4,000 scholarship based on an essay they submitted that outlined what they learned from playing the game. Money Mission, offered by 23 credit unions, is an online interactive game that challenges teens to balance their life along with their finances. Money Mission is a partnership between the Wisconsin Credit Union League and the Credit Union National Association. Twenty-three credit unions, including two outside Wisconsin, offer Money Mission. To view two videos on the award winners, use the link.

Man pleads guilty accused of hacking Fed server

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NEW YORK (4/15/11)--A Malaysian man accused of hacking into a Federal Reserve computer system, pleaded guilty Wednesday to possessing 400,000 stolen credit and debit card numbers. Prosecutors alleged federal agents observed Lin Mun Poo, 32, selling stolen card numbers for $1,000 at a Brooklyn, N.Y., restaurant, shortly after he arrived in the U.S. on Oct. 21, reported Reuters (April 13). They allege he possessed an encrypted laptop with more than 400,000 stolen card numbers. Poo is also accused of hacking into the computer system at the Federal Reserve Bank in Cleveland after finding a vulnerability. The Cleveland bank said the hacking involved 10 "test" computers and that no Fed data were compromised. Poo entered a plea to one fraud count in the U.S. District Court in Brooklyn. He faces up to 10 years in prison under federal guidelines. His sentencing was set for Sept. 13.

Winner of National Fin Lit Poster contest a CU member

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WASHINGTON (4/15/11)--A ninth grade student from West Palm Beach, Fla., who is the winner of the National Foundation for Credit Counseling's (NFCC) 2011 National Financial Literacy Poster Contest, is a credit union member. Jordan Lane-Palmer, a student at A.W. Drewfoos Jr. School of Arts in West Palm Beach, was one of more than 1,800 students nationwide who submitted posters around the theme, "Be a $uperhero! $ave Money!" Making smart money decisions is nothing new to Lane-Palmer, who credits his mother and grandmother with teaching him sound money habits and raising him with an appreciation for money, said NFCC in a press release. "He recently put those early life lessons to work by consistently depositing his allowance into his local credit union account, and allowing the money to grow until he had saved enough to reach his short-term goal of purchasing a robot modeling kit," said NFCC. That let him to bigger savings goals. His new goal is saving for college. "Once you decide to escape from destructive spending habits and follow a stable path for money management, you move closer to fulfilling your dreams for yourself and your family," said Lane-Palmer. The contest introduces young people to the concept of financial literacy and allows them to express their understanding of it through art. At the Jump$tart Coalition Annual Awards Dinner Wednesday night in Washington, D.C., NFCC presented him with the grand prize--a $500 savings bond. While in Washington, he toured the U.S. Bureau of Engraving and Printing, and met with Federal Reserve Chairman Ben Bernanke and Secretary of the U.S. Treasury Rosie Rios.

CUs prepared for National CU Youth Week

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MADISON, Wis. (4/15/11)--There might be a few rock stars hanging out in credit unions next week. Credit unions have spent several months preparing for National Credit Union Youth Week, with this year's theme, "Money Rocks at My Credit Union." The week begins Sunday and ends Saturday, April 23. Youth Week, the Credit Union National Association's nationwide effort to educate young people about the importance of being financially savvy, is a focal point for many credit unions' efforts during National Financial Literacy Month. At the center is CUNA's National Youth Saving Challenge, where credit unions track deposits and new accounts by youth during the month as an effort to get kids into the habit of saving. Here's what a few credit unions are planning:
* The staff at EDTECH FCU, Butte, Mont., will dress as rock stars during the week. "We celebrate Youth Week every year by organizing a Youth Day celebration--it's become one of our favorite get-togethers," said Judy Kiely, who added "the staff has as much fun as the kids--if not more." The celebration focuses on Cubby Club members under age 13. The credit union will provide giveaways, activities and food--pizza, breadsticks and root beer floats served in mood cups. Each Cubby will receive a goodie bag with a microphone, a coin coolie pouch, temporary tattoos, rock 'n' roll stickers, silly band bracelets, a magnetic bookmark, a mood pencil, a coin saver folder, and an inflatable guitar. Activities include four stations: a TV with "Guitar Hero," a table with a "bank" to color and assemble for saving, a TV with "Just Dance" for Wii, and a temporary tattoo station. If a Cubby member brings along a new Cubby, each will receive five gold dollar coins. * Security Service CU, San Antonio, and its branch at Clark High School have students taking a savings pledge during Financial Literacy Month. School staff, teachers and administration also are signing pledge cards. "Everyone who signs up gets a small reward--a coin purse, a calculator or silly pen," says Letha Harrelson, who directs Security Service's education program, told the Texas Credit Union League (LoneStar Leaguer April 14). "But more importantly, they are taking important steps toward saving for the future. We want to encourage thrift, and we want to encourage financial responsibility." * Redwood CU (RCU), Santa Rosa, Calif., will conduct free educational seminars for families on saving and money management on Tuesday at three locations. It also will host a coloring contest for kids under 12, and a $100 Youth Savings Challenge for any RCU youth account holders who make a deposit into their savings account during the week. , plus contests, and provide handouts. "Engaging kids and teens with fun activities like Youth Week is the first step in helping them develop responsible money habits at an early age, which will benefit them for a lifetime," said Lee Alderman, assistant vice president of educational development at Redwood. * Ticonderoga (N.Y.) CU reports it will have financial education materials covering age groups from pre-school to high school on hand in its Ticonderoga, Port Henry and Elizabethtown branches and on its website. Any member under age 18 can enter for a chance to win one of three $50 U.S. Savings Bonds and $100. Ten youth members from credit union nationwide will each win $100. A deposit isn't required to enter. * Marshall (Mich.) Community CU's annual Kids Day tomorrow will feature a Guitar Hero competition, music trivia on the Wheel of Fun, face painting and AAA providing bike helmet fittings/giveaways. "We will be giving away balloons and popcorn to members who come in on Kids Day," said Andrea Tucker, youth/marketing representative. Participants age 18 or younger will earn a ticket for a prize drawing. Prizes include a $50 Savings Bond; tickets for baseball, a water park, the children's museum, the zoo, and Paper Jamz (guitar, drum set and amplifier). Kids making deposits into youth accounts will also earn a ticket for drawings. Also, "we are participating in the National Savings Challenge and will be tracking our progress on a large goal chart that will be located in the lobby of our main office." To market the events, the credit union decorated its lobby with inflatable guitars, provided guitar-shaped gift bags and sunglasses, and featured Youth Week information on its lobby PowerPoints, its website, its newsletter and Facebook. * Kinecta FCU, Manhattan Beach, Calif., said that all new youth accounts opened during the week will receive $5 from the credit union, which will enter them into the Youth Week Sweepstakes for a chance to win one of these prizes: Grand Prize, iPad 2, second prize, iPod touch; third prize, Sea World Family Four-Pack Playcation; and extra chances to win $25 iTunes gift cards. * Altana FCU, Billings, Mont., plans to track youth deposits and new accounts the entire month. "We have a table display in our lobby with educational materials, candy, Brass Magazine, popcorn and coloring pages," said Andrea Vashus, marketing assistant. Each deposit is entered into one of three drawings: for ages up through five years, the prize is a Fischer Price Sing and Play Guitar; for those ages 6-11, Paper Jamz Guitar and Amp Set; for those 12 and older, a DVD of "Glee's" Season 1. Altana also is hosting a "Rockin' Out" photo contest through the end of June, with the winner receiving a $100 gift card, and is teaming up with a local elementary school to provide free activity sheets for the entire student body.

Proclamation notes Wis. CUs year-round fin-lit efforts

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PEWAUKEE, Wis. (4/15/11)--April is Financial Literacy Month, but credit unions have been recognized in a Wisconsin state proclamation for their efforts to teach sound money management year-round. The efforts are part of Wisconsin credit unions’ voluntary REAL Solutions initiative, which aims to help people improve their financial position without regard for profit, said the Wisconsin Credit Union League. For example, credit unions offer:
* Youth-run, in-school credit unions. Young people have saved more than $2.1 million in 109 youth-run branches of credit unions housed inside schools and youth centers statewide. None of the branches drive credit union profits; they teach young people the habit of saving. The branches are considered a best practice for youth financial education. * Savings programs. April 17-23 is National Credit Union Youth Week. The observance annually invites younger members to save. As part of last year’s observance, 3,800 young people in Wisconsin deposited $385,339 in savings accounts. * Classroom learning. Credit unions provide free to all of Wisconsin’s public high schools the brass|STUDENT PROGRAM--including the lifestyle money magazine brass. Resources for students and teachers online support state teaching standards. About 350 teachers actively use it in their classrooms. Credit unions also provide to schools the National Endowment for Financial Education’s High School Financial Planning Program, a classroom curriculum covering personal finance basics. * Online learning. Many credit unions offer financial lessons and tools online. For example, Money Mission offered by 24 credit unions, is an interactive game that challenges teens to balance their life along with their finances. The program recently awarded $12,000 to college-bound students. * Teacher education. Wisconsin credit unions sponsor local teachers attending the National Institute for Financial & Economic Literacy, held annually in Madison, Wis. The institute improves financial lessons for tens of thousands of Wisconsin students. * Financial counseling. Credit unions help members save more or pay down debt. Referrals to credit counselors help members facing more difficult situations. Referrals to classes help people gain or re-gain checking accounts. * Presentations. Credit unions present financial topics at schools and civic organizations. Many offer free workshops to teach members about credit reports, home buying and more. * Educational events. Credit unions participate in reality simulations that teach teens the costs of daily living. Some credit unions support money conferences, events that teach low-income families financial basics. Other credit unions offer savings challenges involving cash prizes. Others offer classes during Money Smart Week Wisconsin.

Iowa house fails to move savings raffle bill

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DES MOINES, Iowa (4/15/11)--An Iowa bill that would allow credit unions and banks to offer savings accounts linked to prize drawings or raffles was left to languish this year on the Iowa House of Representatives’ unfinished-business calendar--in part due to efforts by state bankers to kill it, according to the Iowa Credit Union League. The league ran newspaper ads last week requesting that Iowans call their state representatives to get the legislation passed. The ads also attacked Iowa banks for opposing the bill (The Des Moines Register April 13). The Iowa House did not seem to have sufficient support to pass the bill, Iowa House Majority Leader Linda Upmeyer (R-12) told the newspaper. Despite opposition from the Iowa Bankers Association, the legislation--Senate File 490--passed the Iowa Senate in March by a 30 to 20 vote and moved to the Iowa state House for approval (The Des Moines Register March 21). “Unfortunately the bill became more politicized in the House,” Justin Hupfer, league vice president of governmental affairs, told News Now Thursday. “The majority party [Republicans] had to decide whether to keep it alive and decided not to. My expectation is that we will try again in the next session next year because there’s Democratic and Republican support in both the House and Senate. The second session of the general assembly will pick up again in January in the House Committee where it left off. So it doesn’t have to be reintroduced. “This session, it became a bank versus credit union association battle,” he added. “It took a long time to get the bill out of the Senate, and we didn’t have enough time in the House [this session]. The banks gave it all they had to kill it.” Consumers’ need to find innovative ways to save has never been more pressing, Patrick S. Jury, president of the Iowa Credit Union League, said in a statement, the paper reported in March. Credit unions need to change their traditional ways of thinking to change consumer behavior, he added. State bankers criticized the effort to increase consumer savings by saying they don’t think the possibility of winning a prize should be the basis for encouraging consumers to make decisions about how they are going to save, an Iowa Bankers Association spokesperson told the newspaper in March. Iowa credit unions want to start their program based on a similar one in Michigan in which members who open a “Save to Win” account have their name entered into a drawing for monthly cash prizes between $100 and $1,000. Then, once a year, a drawing is held for a $100,000 grand prize. Participants in the program are allowed to withdraw from the account once a year--but two withdrawals disqualifies them from being in the raffle, Hupfer said in March. Prize money generally comes from credit unions’ operating budgets, Hupfer added. The North Carolina Credit Union League has a similar bill pending in a legislative committee in that state.

Virginia league announces two award winners

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LYNCHBURG, Va. (4/15/11)--The Virginia Credit Union League announced two award winners at its 77th annual meeting April 8 in Norfolk, Va.--Janet Harris and John C. “Jake” Lay.
Click to view larger image Janet Harris (right), a champion for small credit unions and a proponent of small credit unions’ use of technology to better serve member-owners, has been honored with the Virginia Credit Union League’s Eugene H. Farley Jr. Award of Excellence for her service to Virginia’s credit union community. The award was presented April 8, at the League’s 77th Annual Meeting in Norfolk, Virginia. Presenting the award is Virginia Credit Union League President Rick Pillow.
Janet Harris, a champion for small credit unions and a proponent of small credit unions’ use of technology to better serve member-owners, was honored with the league’s Eugene H. Farley Jr. Award of Excellence for her service to Virginia’s credit union community. Harris serves as CEO for the $8 million Riverside Health System Employees CU, Newport News, which boasts 3,200 member-owners. The award is given annually to a credit union professional or volunteer official for outstanding contributions to an individual credit union or to the credit union movement. In particular, the award seeks to recognize achievements that exemplify credit unions’ ‘People Helping People’ philosophy. It is named in honor of retired league President Gene Farley. I think I’ve been so inspired to fight for the future of small credit unions because I believe that we’re still the folks making the $300 loans and who are still very much in touch with our members,” Harris said. “That’s what I still enjoy about my job; I still do the numbers, I do the big picture planning, but I still have contact with our members. I drank the credit union ‘Kool-Aid’ and found the ‘People Helping People’ philosophy that built the credit union system to still be the real mission of credit unions.”
Click to view larger image Virginia’s credit unions saluted longtime credit union volunteer John C. “Jake” Lay (left) for his service to the movement during a special presentation April 8 at the Virginia Credit Union League’s 77th Annual Meeting in Norfolk, Virginia. Lay was awarded the League’s James P. Kirsch Lifetime Achievement Award, which recognizes individuals for extraordinary service to their credit union and the greater credit union community. Presenting the award is Virginia Credit Union League President Rick Pillow. (Photos provided by the Virginia Credit Union league)
The league also honored long-time credit union volunteer John C. “Jake” Lay for his service to the movement. Lay was awarded the league’s James P. Kirsch Lifetime Achievement Award, which recognizes individuals for extraordinary service to their credit union and the greater credit union community. It is named for the late James P. “Jimmy” Kirsch, a longtime credit union volunteer whose passion for the movement led him to leadership roles at the state, national and international levels. Lay began his service in 1969, first as a member of the credit committee at Fairfax County FCU. In 1976, he joined the credit union’s board, becoming the board’s chairman in 1978, a position he’s held to the present day. “For me, it all started because the credit union had an office at work,” says Lay. “After serving on the credit and supervisory committees as a volunteer, I was hooked. I stayed in the movement because I love our ‘People Helping People’ philosophy; I love the fact that service to our members comes first.” In addition to his 40-plus years of service to the credit union, he served for 20 years on the board of directors of what is now Beacon CU, Lynchburg, Va. He spent nine years as board member for the league.

PSCUs CUSO announces new board members

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ST. PETERSBURG, Fla. (4/15/11)--PSCU Financial Services’ member-owner credit unions re-elected three board members to new three-year terms (2011-2014) at the credit union service organization’s 2011 Senior Leadership Workshop & Member Forum business meeting last week. Board members re-elected include:
* Board chairman Craig Esrael, president, First South Financial CU, Bartlett, Tenn.; * Board vice chairman Michael Valentine, president, Baxter CU, Vernon Hills, Ill.; and * Board member Terry West, board member, president, VyStar CU, Jacksonville, Fla.
Officers of PSCU Financial Services’ board of directors also include: Board Secretary Susan Adams, president, Entrust FCU, Richmond, Va., and Board Treasurer Jane Watkins, president, Virginia CU, Richmond, Va. PSCU Financial Services issued a dividend of $21.3 million for its 2010 operations. Also, it passed financial savings of $6.5 million to member-owners in the form of price reductions and rebates during last year. The credit union service organization also achieved a 6.3% boost in net income and revenue and paid $8.9 million in revolving funds due to member-owners four months early, in December of 2010.

Dubuque woman reaps rewards--and freedom--from saving

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DUBUQUE, Iowa (4/15/11)--Dupaco Community CU, Dubuque, Iowa, has helped member Delora Beal discover the rewards of saving--and the freedom it can create.
Click to view larger image Delora Beal prepares to drive home in her newly acquired car, a purchase made possible through her participation in Dupaco Community CU’s Individual Development Account (IDA). Beal systematically saved $1,900 from her paychecks an amount matched by the Iowa Credit Union Foundation. She also received 12 months of financial coaching and an auto loan from the credit union. (Photo provided by Dupaco Communiy Credit Union)
After three years without a car--relying on her feet and a beat-up bike for transportation--the 44-year-old Beal recently became the owner of a 2004 Dodge Intrepid, thanks to her participation in Dupaco’s Individual Development Account program. In the program, a grant from the Iowa Credit Union Foundation matches the savings of the participant dollar for dollar. Dupaco opens the savings accounts and provides the financial coaching required by the program requires to ensure the participant’s goals are met. Beal saved $50 from every paycheck until she had accrued $1,900. That amount was then matched by the foundation. Exactly a year and two days later she was able to buy her car. “Delora took a serious effort into saving as much as she could to increase her match,” said Dupaco Community CU’s Cindy Hilkin, one of Beal’s financial coaches. “She attributes her success to systematic savings. She plans on continuing this type of saving for her auto insurance.” Hilkin helped Beal find a solid vehicle and get an auto loan through Dupaco. Beal credits her success to Dupaco’s financial coaching--and she says the experience has taught her some valuable life lessons. “I've learned that it’s a lot easier to save than what you think. You can still live and save money,” she said. “It makes you re-evaluate your spending habits. It makes you think about the importance of what you really need in your life.” Beal moved to Dubuque from Arizona with her son and a friend three years ago. They packed what they could into a tiny car--some clothes, important paperwork and a computer---and said goodbye to Arizona and steady employment. She eventually found temporary work in Dubuque, but she took a cut in pay. Her employer recently had a new position become available, but it requires travel. Beal hopes her vehicle will make her eligible for the promotion. Two days after buying her car, she was getting the paperwork together to get an Iowa driver’s license and license plates for the new car. Even though she has met her goal in Dupaco’s savings program, Beal says she will continue saving. “I’m looking ahead into the future, and I’m just hoping that having a way to get around will help me better my life. Just knowing I have a car is a whole different sense of relief,” she said. “For the first time in I don’t know how long, I’m just taking care of me.” Participants must meet income guidelines and be residents of or purchase assets in the state of Iowa to qualify for an individual development account. The savings and matching funds are then used by the individual to purchase a specific asset, such as a home, starting or expanding a small business, paying for education or job training, or purchasing a vehicle to get to work.

Four banking trends mean CUs must remain agile

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MOUNTAIN VIEW, Calif. (4/15/11)--Four trends will redefine the banking experience in the next decade, requiring credit unions and their competitors to remain nimble in a environment marked by new competitors, more regulation and impatient, technology-savvy consumers, according to a new report from Intuit. Intuit’s Financial Services division and Emergent Research conducted interviews and forecast workshops with financial services professionals, academics and industry analysts to compile the Intuit 2020 report, a forecast of the demographic, social, economic and technology shifts that will shape the financial services industry in the next decade. Intuit Financial Services is a CUNA Strategic Services provider. The four trends identified in the report are:
* A new playing field for financial services--Increasing regulatory pressures and competition from both traditional competitors and new entrants will drive financial institutions to explore new business models, leading to greater industry collaboration, partnerships and consolidation. * Shifting segments, changing markets--Young and old consumers will demand more from their financial institutions, as aging baby boomers enter retirement and Gen Yers approaching middle age will have new financial needs. Competition to serve mid-market businesses will intensify, further reducing margins for financial institutions. Meanwhile, the small business sector will continue to expand, with the number of small and personal businesses expected to increase by more than seven million over the next decade. Financial institutions must understand and find efficient ways to meet the needs of these businesses, according to the report. * The new customer connection--Technology will drive service. With increased cost pressures and a growing demand for flexibility, accessibility and personalization, financial services organizations must accelerate their use of technology to efficiently meet consumer needs. The financial services industry will combine cloud-based platforms and applications, advanced analytical tools, ever-larger data sets, and social and mobile computing to design and deliver value-added products and services to customers. * Reputation and relationships rule--During the next decade, the financial services industry will shift its focus from transactions to customized, value-added services. Through a combination of both virtual and brick-and-mortar branches, credit unions and banks will develop stronger, more personal relationships with businesses and consumers, helping them manage risk, build wealth, plan retirement and anticipate health-care expenses. Financial institutions that provide useful customer insights will succeed.

Minnesota CUs represented at fin lit roundtable

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ST. PAUL, Minn. (4/15/11)--Minnesota credit unions had strong representation at a meeting with the new state commerce commissioner and his new financial literacy roundtable. Minnesota’s new face on the financial education scene is Commerce Commissioner Mike Rothman. The Minnesota Commerce Department yesterday convened a financial literacy roundtable to bring interested parties--including the financial industry, state agencies, non-profits (including credit unions) and others--to the same table to outline ways that various organizations improve the financial knowledge of Minnesotans. At the meeting, credit unions were specifically recognized by the commissioner in his opening comments for their work in the financial education arena. In attendance were St. Paul-based Affinity Plus FCU President/CEO Kyle Markland and Senior Vice President Sarah Mason; Burnsville, Minn.-based US FCU CEO Bill Raker; and Minnesota Credit Union Network (MnCUN) representatives Kristina Wright, vice president-association services, and Mara Humphrey, vice president-governmental affairs. The meeting encouraged sharing and collaboration among the organizations represented. “Financial literacy is very important to all of us, and there is a strong commitment with this administration to working on financial literacy,” Rothman said. “From the governor on down to the staff, we all share the common goal of wanting to make Minnesota a better place.” Rothman discussed the need to increase coordination of efforts and acknowledged the many barriers that stand in the way of financial education. “As not-for-profit financial institutions, credit unions have long known that member education is the key to success,” Wright said. “While each credit union is different in terms of its size and approaches to financial education, credit unions know that when members make informed decisions on their financial products and services, it benefits both the consumer and the institution.” Among the initiatives discussed was the Ladder Out of Poverty Task Force, which was established in 2010 to focus on asset development, financial education and community support. Also, Minnesota Gov. Mark Dayton and President Barack Obama have declared their interest in and support of financial literacy by proclaiming April as Financial Literacy Month.

Ohio leagues InVest48 attracts nearly 500 CU leaders

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COLUMBUS, Ohio (4/15/11)--With a new name and format, the Ohio Credit Union Leauge’s Annual Convention--now called InVest48--drew 500 participants united to “Participate, Collaborate and Advocate” on behalf of their credit unions. Invest48’s new format offered familiar education breakouts and evening attractions, but added an advocacy track component composed of legislative meetings, a smaller-market credit union track, and peer fireside chats were added. “The annual convention is now in line with the league’s ‘Advocacy First, Plus’ mission as was directed by the league board,” said OCUL President Paul Mercer. “The new name, InVest48, reflects the investment of credit union leaders’ time and energy into the annual event, which takes place over a 48-hour period.” Tuesday’s kickoff grand opening session was keynoted by Tucker Carlson, who shared his views on the upcoming 2012 presidential election, touched on the congressional budget stalemate, and shared personal anecdotes about politicians “I don’t think any of my tax dollars have gone to bail out credit unions; and I appreciate that,” said. Credit Union National Association (CUNA) President/CEO Bill Cheney addressed participants Tuesday, sharing how the national trade association sees important issues such as interchange, member business lending (MBL), supplemental capital, and corporate stabilization playing out. Knowing that many participants would later meet with state legislators, Cheney stressed the importance of advocacy. “Speaker [John] Boehner, an Ohioan, appearing at CUNA’s Governmental Affairs Conference is a reflection that credit unions are recognized now more than ever,” he said. “We need advocacy leadership among all credit unions, at all levels for this to continue.” Elizabeth Vale, who oversees credit unions and community banks for the new Consumer Financial Protection Bureau, also spoke, providing an overview of the regulatory agency. She expressed the agency’s desire for open dialogue with credit unions. InVest48 also played host to the inaugural Up And Comers Network, a group of like-minded credit union staff viewed as the future leaders of the industry. The network was created to help Ohio credit union professionals share best practices, while learning from credit union leaders. The Up And Comers Network question-and-answer session was led by Lee Spivey, CEO of FirstDay Financial FCU, Dayton; Rose Bartolomucci, CEO of TeleCommunity CU, Akron; and Bill Allender, president of BMI FCU, Columbus. About 40 participants took part in the new InVest48 advocacy track, comprising an afternoon legislative briefing, meetings with state representatives and senators, and a legislative reception, open to all InVest48 participants, in the atrium of the Ohio Statehouse. During the meetings, Ohio credit union leaders informed their representatives about impending credit union, issues such as public funds, local government assistance, and MBL. Wednesday morning was highlighted by the annual Regs and Eggs: Morning Mingle with the Regulators. The session gave the new Ohio Superintendent of Financial Institutions, Charles Dolezal, his first opportunity to address Ohio credit union leaders in a group setting. Dolezal, who was accompanied by Deputy Superintendent for Credit Unions Mike Wettrich, said he is working closely with the league to update the section of the Ohio Revised Code affecting credit unions. Former National Credit Union Administration (NCUA) Director of Public and Congressional Affairs John McKechnie also shared his views on the NCUA and the national regulatory environment. During the league’s annual meeting, new League Board Chair Tim Boellner, CEO of AurGroup Financial CU, Fairfield, was introduced. Howard Putnam, former CEO of Southwest Airlines, urged credit unions to simplify during times of difficulty. As a credit union member himself, he also praised the movement.“I know what you stand for, and I endorse moving things forward,” he said. “Be a great team, not a team of greats.” Former Ohio State Buckeye football legend, NFL player, and Heisman Trophy winner Eddie George keynoted the closing session, sharing his inspirational story of learning how to deal with the crossroads of life.

Op-ed Interchange will hit local families

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SAGINAW, Mich. (4/15/11)--The Federal Reserve's proposal on interchange fees "could potentially hit local families in the wallet" and have "the unintended consequence of squeezing consumers by potentially endangering vital services such as free checking," according to an opinion-editorial published in the Saginaw (Mich.) News (April 14) and written by a Michigan credit union CEO. Tim Benecke, president/CEO of Wildfire CU, a $609.3 million asset credit union in Saginaw, wrote that its member-owners "are families who have been credit union members for years in the Great Lakes Bay Region; local small business owners who built their dream with credit union loans; residents who bought a home thanks to affordable credit union mortgages." "That's why a plan in Congress that impacts all debit card fees could potentially hit local families in the wallet," he said, adding that "government should not choose winners and losers in the marketplace." The Durbin Amendment "does just that, and must be delayed, studied and fixed," Benecke said. He noted credit unions "are fighting back to protect our members' free checking and other services through a website called" Credit unions "absorb all the risks and costs of fraud. By cutting interchange fees by 75%, financial institutions of all sizes will be forced to cut programs rather than supporting consumers and making loans to help the economy. It will hurt those who can afford it the least--low-income households with basic checking accounts." Credit unions are calling on Congress to support a bipartisan plan to delay the implementation of the fee cap for a two-year study period, Benecke pointed out. For the full article, use the resource link. The Credit Union National Association (CUNA) supports the bipartisan plan to delay implementation. CUNA and the state leagues have launched a grassroots "Call on Congress" campaign provides a toll-free phone number, website and other resources so that credit unions can mobilize their members in urging Congress to "stop, study and start" over on interchange.

Michigan OFIR Commissioner Ken Ross resigns

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LANSING, Mich. (4/14/11)--Michigan Office of Financial and Insurance Regulation (OFIR) Commissioner Ken Ross Wednesday announced his resignation from the position, effective Friday. Ross was appointed by then-Gov. Jennifer Granholm in February 2008 to a four year term, which expires in 2012 (The Detroit Free Press and The Detroit News April 13). "As Michigan’s first chief regulator of financial institutions with a credit union background, Ken understands the industry, the challenges we've faced in a tough economic climate and the services we provide in the community," said David Adams, CEO of the Michigan Credit Union League and Affiliates. "He has listened to credit union issues and has been a fair regulator for our industry, and we wish him well in his future endeavors." One of Ross's most recent acts was to write a letter to the Federal Reserve Board requesting that it reconsider its approach in implementing the debit transaction fee rule under the Dodd-Frank Wall Street Reform Act, according to the Michigan league's website. Earlier this year, Ross was appointed to the board of directors of the National Association of tate Credit Union Supervisors (NASCUS) to fill the unexpired term of retiring Roger Little. His term expires in September. Previously, Ross was the agency's deputy commissioner for policy and the chief of staff. He also worked as a state assistant attorney general and as vice president of regulatory and legal affairs for the Michigan league. Gov. Rick Snyder has not named a successor.

Moyer confirmed as Pa. Secretary of Banking

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HARRISBURG, Pa. (4/14/11)--Glenn Moyer, acting secretary of banking in Pennsylvania, was unanimously confirmed Tuesday by the State Senate Banking and Insurance Committee as secretary of banking. Moyer, who was nominated by Gov. Tom Corbett, is familiar with credit unions. While serving as as an officer in the U.S. Air Force, stationed at Cannon Air Force Base in New Mexicohe he was a volunteer member on the credit committee of a credit union for armed services personnel, said the Pennsylvania Credit Union Association (PCUA) (Life is a Highway April 13). Moyer said his priorities are to make all financial institutions aware of the department’s strengths, to provide support for a strong economy and to support business models that are good for the market. The Dodd-Frank Act is a “sea of change that will have a significant impact on how financial firms do business,” he said. Though he does not know how Dodd-Frank will change the industry, as a state Pennsylvania must be heard as new interpretations and regulations are considered in Washington, he said. “We need to let the Washington regulators know that, while we respect them and their work, we are not going away--and that the balance between the state and federal charters needs to be clear and preserved for the future,” he said. In congratulating Moyer on the appointment, PCUA President/CEO Jim McCormack said: “We appreciate his leadership in protecting the well-being of state-chartered financial institutions and his depth of knowledge of the needs and challenges of Pennsylvania’s financial institutions. We look forward to working with him in the years to come,” Moyer will address PCUA’s Annual Convention on May 11.

IN.Y. TimesI Two CUs ahead of big banks on smart cards

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NEW YORK (4/14/11)--Two credit unions are well ahead of the big banks on providing smart cards, solving a problem many travelers face with U.S.-based credit and debit cards not working overseas, said The New York Times Tuesday. U.S. cards rely on older magnetic-stripe technology. Many countries, especially in Europe, use chip technology. That means many vendors overseas can't process Americans' magnetic stripe cards. "So if, like most Americans, you bank at a financial institution in the U.S. your card could potentially cause you some problems overseas--unless, that is, you happen to be a member of a small credit union," said the Times. It noted that the State Employees' CU (SECU) of Raleigh, N.C., just began offering debit cards with the E.M.V. (Europay, MasterCard, Visa) chips to members. Leanne Phelps, senior vice president of card services at SECU, told the Times the credit union had heard about problems with acceptance of cards from members traveling internationally. Although the problem was sporadic and affected a small percentage of the credit union's debit transactions, the credit union made the switch after learning that Canada and Mexico were moving to chip cards. Another credit union, the United Nations FCU, based in New York, has offered credit cards with chips for about a year, said the article. The Times questioned why credit unions could offer the latest card technology while big banks don't. Experts told the newspaper that big banks are still waiting for widespread adoption of the chip technology and that the only country not advanced in the technology is the U.S. Also banks haven't felt a serious financial hit from crime to justify the switch to the more fraud-resistant chip cards, the article said. To read the article, use the link.

Excellence Awards presented by HRTD Council

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MADISON, Wis. (4/14/11)--The inaugural CUNA Human Resources and Training Development Council Excellence Award winners were announced during the councilfs 17th annual conference, this week in San Francisco.
Click to view larger image Executives from eight credit unions accepted awards for inaugural CUNA HR/TD Council Excellence Awards at the councilfs national conference in San Francisco this week. From left, front row: Anthony Daniels, SECU, Linthicum, Md.; Marla Casley, Oregon Community CU, Eugene, Ore.; and Michelle Trekas, Red Canoe CU, Longview, Wash; Middle Row: Lynn Stephens, Mountain America CU, West Jordan, Utah; Ken Kelly, Red Canoe CU; and Darryl Shiroma, HawaiiUSA FCU, Honolulu; and Back Row: Linda Krakora: NuMark CU, Crest Hill, Ill.; Kimberly Maxwell, SunState FCU, Gainesville, Fla.; and Lee Wiersma, UW CU Madison, Wis. (Photo proved by CUNA HR/TD Council)
The award recognizes credit unions that exemplify excellence in the human resources and training disciplines and serves to promote credit union philosophies through people leadership. This yearfs winners by category are:
* Employee Engagement (less than $499 million in assets): NuMark CU, Joliet, Ill. for its Profit & Cash program. This program challenged staff to grow services within the current membership and increase overall membership in spite of the depressed economy. The resulting growth led to the need for a new branch, which opened in January. * Employee Engagement ($500 million to $1 billion): HawaiiUSA FCU, Honolulu, for its Junior-ee Summer Internship Program. By making the students Junior Employees (Junior-ee), HawaiiUSA FCU redesigned its internship program with an emphasis on providing students with real]world work experiences. * Employee Engagement (more than $1 billion): UW CU, Madison, Wis., for creating a culture of high engagement. Working from the results of employee surveys, UW CU improved its employee engagement score and was recognized as one of the gBest Places to Workh by Madison magazine. * HR/TD Management Practices (less than $499 million): SunState FCU, Gainesville, Fla., for its SunWell Program, which promoted health and well-being for employees. The program included wellness challenges, encouraged team participation, and led to a more pleasant and productive work force. * HR/TD Management Practices ($500 million to $1 billion): Oregon Community CU in Eugene, Ore., for its 360 Training: Excelling in a Sales Culture. The training, created by Oregon Community CU staff, blended product and service training with sales training, and served to help transition staff into a high functioning sales team that exceeded all goals. * HR/TD Management Practices (more than $1 billion): SECU in Linthicum, Md., for its Connections 4.0 Upgrade Learning Program. The upgraded learning system resulted in cost and time savings by changing training from a traditional brick-and-mortar classroom to a more effective blended learning approach. This allowed staff to acquire new skills through an on-line learning solution while applying targeted face-to-face resources to support managers in the rollout. *HR/TD Strategic Leadership ($500 million to $1 billion in assets): Red Canoe CU in Longview, Wash., for its Professional Activities to Direct and Develop Leadership Excellence (PADDLE) Program, which was created as a targeted approach to cultivating true talent in the organization. Six of the initial 12 PADDLE participants have been promoted to a higher level within the credit union. * HR/TD Strategic Leadership (More than $1 billion in assets): Mountain America CU in West Jordan, Utah, for its Talent Management and Succession Planning Process. The credit union developed a full-circle talent management process that matched employee aspirations with company needs and provided on-going employee development. The result was lower turnover and increased employee satisfaction.

Georgia CUs grew membership by 2.3 in 2010

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DULUTH, Ga. (4/14/11)--Georgia credit unions grew membership by 2.3% between December 2009 and December 2010, according to new data from the Georgia Credit Union Benefits Index, announced the Georgia Credit Union Affiliates. That is an increase from the 0.9% membership growth credit unions experienced between December 2008 and December 2009, according to a release from the league (Professional Services Close-Up April 11). Between December 2009 and December 2010, total assets at credit unions statewide grew by 2.7% to $16.6 billion, according to the index. Also, total loans grew by 3.9% while savings increased by 7.6%--a sign that Georgia consumers are looking to keep more of their money, not spend it, the league said. “It’s no surprise that Georgians are continuing to entrust credit unions with their money,” said Mike Mercer, president/CEO. “Credit unions offer a safe alternative to other financial institutions and continue to save members money through better rates and fewer fees.” The group noted that interest rates for a number of loan options remained lower for the state’s more than 1.8 million credit union members. Coupled with lower fees and higher rates for savings products, total benefits equated to nearly $116.2 million or $64 per member and $122 per member household. Also:
* Georgia credit union members saved more than $63 million as a result of lower interest rates on loan products; * Higher interest rates on savings products yielded members nearly $17 million in benefits; * Members saved more than $36 million through fewer and lower fees compared to other financial institutions.
The index, based on data collected between December 2009 and December 2010, uses data compiled from more than 160 Georgia credit unions and banking institution statistics from Datatrac, a rate survey firm.

Illinois DFI credits CUs 23 on first-quarter fees

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NAPERVILLE, Ill. (4/14/11)--A credit of more than 23% is being reflected on Illinois’ state-chartered credit unions’ April regulatory fee invoice for first quarter from the Illinois Division of Financial Institutions (DFI). The credit reflects a partial holiday resulting from a remaining amount due to credit unions after a total holiday on their 2010 fourth-quarter regulatory fee, which would otherwise have been paid in January to the DFI. An aggregate credit of nearly $1.5 million will be received by Illinois-chartered credit unions. The Illinois Credit Union League’s (ICUL) legislation to implement the court-approved settlement of the regulatory fee case it filed against the state in 2004 was signed into law by Gov. Patrick Quinn, effective April 6, 2009. Under the terms of the settlement, state-chartered credit unions received a cash payment from the state in June 2009, in the aggregate amount of $6.2 million. The payment represented a credit for the overpayment in regulatory fees made under former Gov. Rod Blagojevich’s administration fee escalation and transfer (“sweep”) budgetary arrangement adopted by the state in its fiscal years 2004 through 2006. The 2009 legislation implementing the settlement also accomplished two other goals. It codified a rate reduction in regulatory fees going forward, commencing Jan. 1, 2009, and also reduced the Credit Union Fund margin that triggers a credit back to credit unions. The Credit Union Fund is the dedicated fund into which regulatory fees are deposited to offset the ordinary administrative and operational expenses of the DFI Credit Union Section in supervising state-chartered credit unions. It is structured as an operating account, not a savings account. To ensure that objective was met, the legislation reduced the margin level to 25% from 50%. When the balance in the Credit Union Fund at the end of a state fiscal year exceeds 25% of the expenses incurred by the state in administering the Illinois Credit Union Act and related laws, the excess must be credited to the credit unions that paid the fees. “The environment for Illinois credit unions continues to be challenging,” said Dan Plauda, ICUL president/CEO. “As we enter the second quarter of the year, this credit is a welcome boost to their bottom line, as they continue to serve their members in this highly competitive marketplace.”

MnCUN recognizes professional volunteer of year

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BLOOMINGTON, Minn. (4/14/11)--The Minnesota Credit Union Network (MnCUN) announced the recipients of its two most prestigious awards Saturday. The Outstanding Credit Union Volunteer of the Year and the Outstanding Credit Union Professional of the Year Awards are honors bestowed on two individuals for demonstrated excellence in the movement.
George and Kay Rossez of St. John’s CU, Little Canada, received the Minnesota Credit Union Network’s 2011 Outstanding Volunteers of the Year Award Saturday for their 50 years of service to the credit union movement.
These and other awards were presented at a banquet held during the MnCUN 2011 Annual Meeting and Convention Friday and Saturday in Bloomington, Minn. This year’s Volunteer of the Year Award honorees were George and Kay Rossez of St. John’s CU in Little Canada. The joint recognition acknowledged the Rossezes’ credit union careers, which have been closely intertwined the past 50 years. George served as the credit union’s manager from 1962 to 1974 and helped grow its assets by more than $1 million. During his tenure as manager, Kay volunteered at the credit union in a variety of capacities. In 1972, she became a paid employee of the credit union and eventually took over as CEO after George retired.
For the past 30 years, Kyle Markland, president/CEO of Affinity Plus FCU, St. Paul, has served the credit union movement. On Saturday, he received the Minnesota Credit Union Network’s 2011 Outstanding Professional of the Year Award. (Photos provided by the Minnesota Credit Union Network)
Even though they both have retired from the credit union, the Rossezes continue to volunteer and be active members. George has served on the credit union’s board of directors since 1983 and regularly volunteers for additional committee assignments. Kay, an active leader, serving on the supervisory committee and providing guidance on credit union issues. They are both political advocates for the credit union movement and have regularly attended the Credit Union National Association’s (CUNA) Governmental Affairs Conference for the past 20 years. MnCUN’s Professional of the Year Award is Kyle Markland of Affinity Plus FCU in St. Paul. Markland has worked in the credit union movement for 30 years, serving the past 14 years as Affinity Plus FCU’s president/CEO. Under Markland, the credit union has grown from $357 million to more than $1 billion in assets and doubled its membership. He led the credit union in implementing innovative and outstanding service by introducing business models that gained the attention of Harvard Business School. Markland has also been an integral part of the credit union movement serving on a number of board and committees for Members United Corporate FCU, CUNA, Member Gateways, and the Filene Research Institute. Also, Markland serves as MnCUN’s board chair.

CU System briefs (04/13/2011)

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* MADISON, Wis. (4/14/11)--Jacqueline A. Smith, 32, of Oregon, Wis., a former branch manager and 10-year employee of Dane County CU, Madison, Wis., was charged Tuesday with fraud in the theft of more than $36,000 from the credit union. The embezzlement involved falsifying loans to family members and taking the money for personal use to pay off personal debt. The relatives were unaware of the loans, which were taken out in their names between 2008 and 2010, according to the complaint filed in Dane County Circuit Court (Wisconsin State Journal April 13) … * WICHITA, Kan. (4/14/11)--The getaway driver in a Nov. 8, 2010, robbery of Catholic Family FCU, Wichita, Kan., was sentenced to 51 months in prison after pleading guilty to his role in the heist (Wichita Eagle April 12 and April 11. Christopher Crabtree, 20, of Wichita, admitted he met with co-defendant Deshane Gantt to plan the robbery. He drove with Gantt to the credit union, and Gantt, armed with a pistol, went into the credit union, announced that "This is a robbery … I don't want to turn this into a homicide," and vaulted the counter to collect cash from drawers. During their getaway, the men encountered a police patrol car. When police searched the car, they found loot in a pillow case. Gantt, who also pleaded guilty, is scheduled for sentencing on April 18 … * HARBOR, Ore. (4/14/11)--Chetco (CFCU) FCU President/CEO Stan Baron has announced he will retire May 1. He has more than 40 years' experience in the credit union industry, with nearly 20 years as a president/CEO. He arrived at CFCU in June 2000. Baron oversaw the increase of the credit union's assets from roughly $100 million to more than $370 million and the expansion of its service area to include Coos County. During his tenure, CFCU took a more active role in its communities with an emphasis on assisting small businesses and those often denied access to financial services by national and larger financial institutions. He noted that "after more than 40 years in the credit union industry, it is time to spend more time with the grandchildren." The board of directors, chaired by Dr. Jim Nelson, is working on determining a successor. In the meantime Executive Vice President and General Counsel Peter Spratt will serve as interim CEO … * HARRISBURG, Pa. (4/14/11)--Len Shimko announced his retirement as president/CEO of Cross Valley FCU, Wilkes-Barre on Monday, during the credit union's annual meeting, according to the Pennsylvania Credit Union Association (PCUA) (Life is a Highway April 13). Ed Kaushas, attorney/certificated public accountant, was introduced as the credit union's new CEO. Shimko served as president/CEO for 42 years. He will remain active as treasurer of the credit union's board of directors. Shimko was the 1993 recipient of the Lifetime Achievement Award for Credit Union Professional of the Year, presented by PCUA … * OKLAHOMA CITY, Okla. (4/14/11)--Gary Eugene Sawyer, former chairman of Oklahoma City, Okla.-based Tinker FCU's board of directors, died April 7. He was 68. Sawyer had been a board member since 1991 and served as chairman three times. He is survived by his wife, two step-children, two step-grandchildren, and three sisters and a sister-in-law. Services were Wednesday in Oklahoma City (The Oklahoman April 10) …

Filene CU ring NYSEs closing bell

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MADISON, Wis. (4/13/11)--Representatives from the Filene Research Institute and the Brooklyn Cooperative FCU were among celebrants of Financial Literacy Week to ring the Closing Bell Tuesday at the New York Stock Exchange (NYSE). Filene Research Institute CEO Mark Meyer and Denise Gabel, chief innovation officer at Filene, joined the Center for Financial Services Innovation (CFSI) staffers Jennifer Tescher and Sarah Gordon to ring the bell. They were joined by funders of CFSI's Financial Capability Innovation Fund and the fund's five grantees. Filene and Brooklyn Cooperative FCU/Grow Brooklyn with Piggymojo are among the grantees. The fund supports initiatives that provide Americans access to the financial products and educational tools. It was the second day in a row that credit unions were on hand to ring the bell. Monday representatives of Biz Kid$, the Emmy award-winning financial literacy series on public television underwritten by America's Credit Unions, and the Washington Credit Union Foundation rang the closing bell.

Texas CEOs concur Confidence is up

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FARMERS BRANCH, Texas (4/13/11)--Several credit union CEOs in Texas say they concur with the latest Conference Board Measure of CEO Confidence, according to the Texas Credit Union League. Last week the board said the CEO confidence measure, which "bounced back" in the final quarter of 2010, also improved in the first quarter of 2011. The measure read 67, up from 62 in the last quarter. A reading of 50 or above indicates more positive than negative responses. The league said several credit union CEOs weighed in on the report. Bob Peterson, president/ CEO of El Paso-based One Source FCU, said he is not only optimistic about current and future economic conditions, but his expectations for the credit union are also positive. El Paso was in a unique position during the economic downturn, he said. The local economy, while challenged, probably was less impacted by global conditions than other areas. One Source FCU saw an increase in bankruptcies, heightened delinquencies and charge-offs, and some members were under high financial stress. However, the economy is "indeed turning positive" and the credit union's core membership "has remained highly loyal to One Source as their institution of choice," Peterson told the league. Also, the past two to three years of challenges have seen credit unions emerging "as the financial partner of choice for countless more consumers in the economy," he added (LoneStar Leaguer April 8). Angie Owens, president/CEO of American Airlines FCU, Fort Worth, said its Trade, Industry , Profession (TIP) charter allows it to serve employees of companies supporting the air transportation industry--not just the airlines. The industry as a whole is a vital part of the U.S. economy "so we continue to grow membership and believe we will continue at a steady pace" in the industry, she told the Texas league (LoneStar Leaguer April 11). Owens said she is confident the economy will continue to improve "although slowly. We have maintained a strong balance sheet through the difficult times and do not see that changing either." James Boyd, president/CEO of Abilene Teachers FCU, has always been confident about his credit union's future, he said. It has hired 26 employees since last August, bringing its staff to 108, and opened its new 33,000-square-foot main office in February. "Funds continue to roll in our door putting us over $300 million in assets. Loan demand is lagging that cash influx, but still positive," he reported to the league. Abilene is on the fringe of the main oil activity in West Texas so the local economy is less volatile than the Midland/Odessa area. "Oil prices continue to climb, and that's good for this part of the country," he said (LoneStar Leaguer April 11). The Conference Board survey was conducted between mid-February and mid-March. Among its findings:
* Nearly 61% of CEOs surveyed said current conditions within their industries have improved, up from 55% who said so last quarter; * For short-term outlook, 66% expect an improvement in economic conditions during the next six months, up from 56% last quarter; * The outlook for their own industries were slightly less optimistic--49% of the CEOs expected their industries to improve, down from 51% last quarter; and * Half expect an increase in employment levels in their industry, up from 30% a year ago. Those who expect a decrease in hiring declined to 16% from 22% last year.

CUs checking accounts best Schenk to IBankrateI

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MADISON, Wis. (4/13/11)--When it comes to offering higher interest rates, credit union interest checking accounts regularly outdo other types of accounts--including those of banks--Mike Schenk, vice president of research and statistics at the Credit Union National Association, told Bankrate Tuesday. The article was also picked up by Fox Business and Yahoo! Finance websites. “On average, there’s about a 15-basis-point advantage with credit unions,” Schenk said. He expects the advantage to increase when the economy improves, he added. “Credit unions are not for profit,” Schenk said. “They’re owned by their member depositors, so any profits go back to those members.” Interest checking accounts that earn more than the industry average typically have conditions attached, such as requirements for a minimum number of debit transactions per month or direct deposit, Schenk told Bankrate. Bankrate listed five general ways consumers can qualify for credit union checking:
* Regularly use a debit card--Many credit unions require members to use their checking account debit card a minimum number of times per month; * Accept electronic statements--Credit unions may require their interest checking account holders to sign up for electronic monthly statements instead of receiving paper statements by snail mail; * Sign up for direct deposit--Another common requirement for high-interest checking depositors is to sign up for direct deposit on their accounts; * Deposit up to the maximum amount--Many credit unions put a cap on the amount of money in a checking account that can earn the highest yields on interest checking. This cap is usually about $25,000; * Don’t forget membership--All the interest-checking perks a credit union offers are available only to its members.
To read, the article, use the link.

Oregon and Wash. CU Foundations to merge

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FEDERAL WAY, Wash. (4/13/11)--The boards of directors of the Oregon Credit Union Foundation (OCUF) and the Washington Credit Union Foundation (WCUF) have signed a letter of intent to merge. In the April 1 letter, the two groups state their intent to “proceed in mutual good faith to continue discussions and complete work required to consummate the proposed merger.” The foundations will continue their regular support--including scholarship, grants and landmark programs such as the Credit Unions for Kids program--of credit unions in the two states. The combined foundations would have $2.5 million in reserves and a goal of improving operational efficiencies and expanding their reach, said the two board chairs, Carlyn Roy of OCUF and Paula Slaye of WCUF. This is the second merger this year involving credit union agencies in Oregon and Washington. The memberships of the Credit Union Association of Oregon and the Washington Credit Union League voted “overwhelmingly” in early November to create the combined Northwest Credit Union Association (NWCUA), which began operations on Jan. 1 (News Now Nov. 12). Operational priorities for the new NWCUA are focused on government affairs, regulatory relief and compliance services. During months of merger discussions, which included the formation of committees and conversations with the membership, both trade associations united in identifying objectives and strategies for the NWCUA.

Members 1st in second suit over M trademark

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HARRISBURG, Pa. (4/13/11)--Members 1st FCU, based in Mechanicsburg, Pa., has filed a second trademark infringement lawsuit over the use of its "M" logo. This time the suit is against South Jordan, Utah-based Merrick Bank Corp. The latest suit, filed April 5 in the U.S District Court, Middle District of Pennsylvania (Harrisburg), seeks preliminary and permanent injunctive relief, damages, and attorneys' fees for "trademark infringement, unfair competition and false designation of origin of goods." According to the complaint, Merrick recently began soliciting credit card customers using the logo in $1.5 billion asset Members 1st's territory. The credit union began using the mark, which incorporates "1st" into the "M" logo, in early 2003. It received registration of the mark from the U.S. Patent and Trademark Office on Jan. 31, 2006, said the complaint. The credit union has "consistently promoted its brand and services using the mark on television, radio, billboards, email, print advertising, public relations, community sponsorships, giveaways and the internet," said the document. It added that market research shows its brand is "well known across its target audience, with 94% of survey respondents associating the mark with Members 1st." "Merrick's use of a virtually identical logo to sell competing products in the same geographic area is likely to cause consumer confusion and is exacerbated by the fact that Merrick's credit card products are identical and are likely to be sold in the same markets, through the same trade channels, and to similar and overlapping customers," said the complaint. The complaint alleges the infringement would cost the credit union sales, "with the bank likely to unfairly gain recognition and sales at Member 1st's expense by benefiting from the reputation, goodwill and recognition already established and embodied in Members 1st's distinct trademark." It also would result in loss of control over its brand reputation and injure Members lst if consumers are dissatisfied with Merrick's products for any reason. In 2009, Members 1st filed a similar suit against a local bank Metro Bank of Harrisburg, which uses a big red M as its symbol. The bank unveiled its logo in June 2009 as part of a conversion of Commerce Bank/Harrisburg to Metro Bank (News Now July 7, 2009). Members 1st and Metro Bank have since settled the suit.

NCUF opens Wegner Award nominations

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MADISON, Wis. (4/13/11)--Nominations are due June 17 for the 24th Annual Herb Wegner Memorial Awards, to be presented by the National Credit Union Foundation (NCUF). The awards are named in honor of late Credit Union National Association (CUNA) CEO Herb Wegner, whose innovative ideas and deeds revolutionized the ways credit unions serve their communities. The awards carry on Wegner’s spirit of “innovative, creative, risk-taking” leadership, said NCUF. Winners will be honored at the awards dinner on March 19, 2012 in conjunction with the Credit Union National Association Governmental Affairs Conference in Washington, D.C. “The Wegner Awards are widely considered the highest national honors in the credit union movement,” said Bucky Sebastian, NCUF executive director. “Therefore, we encourage credit union supporters from every state to nominate their best and brightest for the awards.” The following award categories are open for nomination:
* The Individual Achievement Award honors an unsung hero for innovative concepts and accomplishments that have made a significant impact on the national and/or international credit union movements within the past 10 years--or have a significant potential impact now. Nominations must cite a specific subject of achievement. Examples include financial literacy, service to the underserved, alternatives to predatory lending, and/or new products. * The Outstanding Organization/Program Award honors an organization or program for innovative concepts, products or services that have made an impact with measured results on the national and/or international credit union movements. * The Lifetime Achievement Award honors an individual who has dedicated his or her life to promoting the credit union philosophy of “people helping people.” This person must have created innovative concepts and provided leadership that has made a significant and lasting impact on the national and/or international credit union movements.

HRTD Council exec committee announced

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MADISON, Wis. (4/13/11)--Officers and executive committee members for the CUNA Human Resources & Training Development (HR/TD) Council were announced during the council’s 17th annual conference, this week in San Francisco. The annual election by the council membership was held in the months preceding the conference. Incumbents who were re-elected are:
* Robert Davis, senior vice president of human resources, VyStar CU in Jacksonville, Fla.; * Jeffrey Duke, organizational development and leadership manager, BECU in Seattle; and * Michelle Greear, assistant vice president of training and career development, Technology CU in San Jose, Calif.
Newly elected to the executive committee is Roberta Smith, senior vice president for Missoula (Mont.) FCU. Smith replaces outgoing committee member Jennifer Morse, vice president of human resources for Empower FCU in Syracuse, N.Y. Also, Jennifer Huggard, director of business administration for the Northwest CU Association in Federal Way, Wash., replaces Danielle Brown, vice president for the Northwest Credit Union Association, whose position has changed within her organization. Suzanne Oliver, senior vice president of educational services and chief learning officer for Mountain America FCU in West Jordan, Utah, is the new council chair. Diane Wozniak, manager human resources for Tampa Bay FCU in Tampa, Fla. was elected vice-chair. Jeffrey Duke, organizational development and leadership manager for BECU is secretary/treasurer. The CUNA HR/TD Council executive committee includes:
* Robert Carmichael, senior vice president of human resources and training and development for Maine Savings FCU, Hampden, Maine; * Jennifer Godel, vice president of human resources and training and development and quality for Desert Schools FCU, Phoenix; and * Kathy Spahr, human resources, training and development director, EECU, Jackson, Mich.
The conference ends today.

AVCU testifies on mortgages in secondary market

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SOUTH BURLINGTON, Vt. (4/13/11)--Association of Vermont Credit Unions President Joe Bergeron testified last week before the state House Commerce Committee in support of a measure that would solidify Vermont lenders' ability to sell a mortgages involving private road properties on the secondary market. The bill, H. 272, was introduced by Reps. Bill Botzow (D-1) and Michael Marcotte (R/D-2), chair and ranking member of the committee. It is being advanced by the Vermont Mortgage Bankers Association (VMBA), which is headed by Jason Pidgeon, a loan officer at New England FCU, Williston. Pidgeon also testified in support of the bill (Newslines Express April 8). At issue is Fannie Mae's requirement for a documented maintenance agreement between property owners on private roads. Without an agreement, Fannie's guidelines look to a default agreement in state law. However such a law does not exist in Vermont, said AVCU. H.272 creates default agreement statutory language that goes into effect only when no other document exists. Bergeron presented results of a survey of the state's credit unions indicating that a lack of documentation is fairly common, causing potential underwriting issues for the lender with loans to sell on the secondary market. In aggregate, mortgage lending credit unions reported from 5% to 10% of their mortgage business involved private roads due to the rural nature of the state. Similar legislation passed the House last year but was not voted out of the Senate, said AVCU.

Pa. treasurer touts CUs payday loan alternative

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WILKES-BARRE, Pa. (4/13/11)--Pennsylvania State Treasurer Rob McChord visited Cross Valley FCU, Wilkes-Barre, Pa., Tuesday to tout the "Credit Union Better Choice" program, a money-saving alternative to predatory payday loans that helps improve consumers' finances in the long run. The program has already saved state consumers $15 million in exorbitant fees and interest when compared with traditional payday loan products. Credit Union Better Choice is a partnership between Treasury and the Pennsylvania Credit Union Association. McChord visited the credit union to hear firsthand how the program helped three local women meet unexpected expenses and start on the path to financial security. He encouraged consumers during National Financial Literacy Month to take control of their financial future by developing a monthly budget and building personal savings. "This program--with its financial counseling services and savings component--can help to get you started," he said. A $500 Better Choice loan costs consumers $42.50 for 90 days, compared with payday lenders' charges of $15 per $100 borrowed for two weeks, or about $450 over 90 days. Participating credit unions have made 43,000 Better Choice loans totaling $20.5 million since 2006, when the program was established. Cross Valley FCU has issued 280 Better Choice loans to 101 members since 2007. The loans are available at 79 credit unions with 222 locations in the state. According to PCUA President/CEO Jim McCormack, the partnership "allows borrowers access to low-cost loans for short-term borrowing needs through credit unions. Every day, credit unions work to better the lives of their members and this is just one way in which credit unions can help." Edward Kaushas, president/CEO of Cross Valley FCU, noted that the decision to offer the program "was an easy one. This program best illustrates the fundamental mission of credit unions, which is that of 'People Helping People.'"

Tuma Merket nominated for Texas CU Commission

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FARMERS BRANCH, Texas (4/13/11)--Texas Gov. Rick Perry has nominated two new appointees and re-nominated two others to the Texas Credit Union Commission. The new nominees include Gary Tuma, president/CEO of Smart Financial CU, Houston, and Sherri Kay Brannon Merket, a Midland resident, said the Texas Credit Union League (LoneStar Leaguer April 12). Tuma is nominated for an industry seat formerly held by Barbara Sheffield, former president/CEO of Members Choice CU, Houston. Merket has been nominated for a public member seat. Current public members Rob Kyker and Manny Cavazos were re-nominated. Current public member Pete Snow has rotated off the commission as a public member. The terms of Tuma, Merket and Cavazos would expire Feb. 15, 2017. Kyker's term would expire Feb. 15, 2015. The commission oversees the activities of the Texas Credit Union Department and serves as a primary point of accountability for ensuring that state credit unions function as a system.

Its National Volunteer Week

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MADISON, Wis. (4/12/11)--National Volunteer Week is this week and its theme--Celebrating People in Action--recognizes the 63 million Americans who gave their time last year in community service. Many of them are volunteers from credit unions. "This is a time to recognize your volunteers and the tremendous impact they make in your credit union, guiding you through your successes, challenges, and into the future," said the Pennsylvania Credit Union Association in its newsletter, Life is a Highway Monday. The week presents an opportunity to celebrate the ordinary people who accomplish extraordinary things through service, PCUA said. At least one league--the Maine Credit Union League--keeps track of how much the state's credit unions volunteer through its Credit Unions Share for ME. In 2010, Maine's credit unions--staff and directors--volunteered a record-setting 31,349.75 hours--a 35% increase over their total hours in 2009--to various community projects. Since it began in 2001, the program has documented more than 180,000 volunteer hours completed, said the league on its website. The Bureau of Labor Statistics calculates the value of one hour volunteered in Maine at $16.53. That brings the value of the time volunteered by Maine's credit unions equal to $518,000 in 2010, said the league. More than 2,000 individuals volunteered in their communities this past year. An average of 334 credit union staff and directors volunteered each month in 2010. In 2010, the top five credit unions in Maine contributing the most volunteer hours were: Saco Valley CU, based in Saco, with 3,808 hours volunteered; Community CU in Lewiston (2,562.25); University CU in Orono (2,388.50); Rainbow FCU in Lewiston (2,301); and Five County CU in Bath (2,108). The top five credit unions in the state with the highest average number of individuals volunteering each month were: University CU (30 people); Maine Savings FCU in Hampden (24); Saco Valley CU (19); Rainbow FCU (18); and Community CU and Five County CU tied for fifth place with an average of 16 staff members volunteering each month. "Credit unions were formed by volunteers and, to this day, are still governed by a volunteer board of directors," said John Murphy, president of the Maine league. "The participation and involvement on the part of Maine credit unions in the communities they serve is a commitment that credit unions take very seriously. From working to end hunger to taking a leadership role in helping to bring financial education to students in record numbers, giving back through time is a core value and philosophy of Maine's credit unions. Volunteering is part of the fabric of what credit unions are all about," Murphy added. Credit unions volunteer in their communities nearly every single day, said Jon Paradise, Maine league governmental and public affairs manager. "Credit union staff and directors are active on non-profit boards, helping in schools and at soup kitchens, as well as countless other activities and events. The reason is simple--helping others is the right thing to do." In 2010, the Maine program averaged 2,612 hours volunteered per month, a 31% increase over the previous year, with an average of 334 volunteers participating--nearly double 2009 participation levels. These figures are only the documented figures provided by participating Maine credit unions; "the actual number is likely significantly higher but we are pleased with the growth the program experienced in the past year," said Paradise. In his proclamation of National Volunteer Week, President Barack Obama noted that, "During National Volunteer Week, we celebrate the profound impact of volunteers and encourage all Americans to discover their own power to make a difference." National Volunteer Week, sponsored by Points of Light Institute and HandsOn Network, the nation's largest volunteer network, was established in 1974. This year's recognition is a week earlier than the traditional third week of April to avoid conflicts with religious holidays of Passover and Easter, said the Pennsylvania Credit Union Association.

Gen X Y job seekers values align with FIs

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WINDSOR, Conn. (4/12/11)--Credit unions hoping to attract young talent will need to change their recruiting strategies if they want Gen X and Y job seekers to apply for job openings. According to a new study, Gen X and Y job seekers have values that align with a financial services profession--but their perceptions of financial services get in the way. Younger generation job seekers have a disconnect related to financial services jobs, said LIMRA Distribution Research, a research, consulting and professional development organization for insurance and financial services companies, which conducted focus groups and surveys of recruiters in the industry. Generations X and Y job seekers, when asked if they are interested in a financial services sales position, say no. However, almost all say "yes," when asked if they are interested in working in a stable industry with lots of growth potential and opportunities to make a difference in people's lives--something the financial services industry provides. "Gen X and Y job seekers have some real misperceptions about the financial services industry and the image of a sales person within the industry," said Polly Painter Eggers, analyst with the company. "Strikingly, the core values that these job seekers profess are the same attributes of the financial services industry. While some of the divide can be overcome by better communication, there are opportunities for companies to adapt their recruiting strategy to attract more candidates," she added. The financial services industry has one of the most rigorous recruiting processes to help the candidate and the company determine how well they fit together, and the process works well with those who use it, LIMRA said. It found 85% of financial representatives are extremely satisfied with their choice of profession, and 66% would highly recommended their profession to young job seekers. However, the industry isn't attracting as many viable candidates as it could. LIMRA's study of 272 recruiters in the iindustry indicates that many companies have held on to traditional recruiting and compensation structures that, while popular with Baby Boomers, have not attracted the younger job seekers. For example, Gen X and Y job seekers surveyed said they value stability and security over the potential for making a lot of money. However, industry recruits still use the opportunity to make money and the lifestyle that follows to sweeten the pot. The younger generations network online--both personally and professionally--and expect the latest technological tools at their disposal to help them communicate with their network. Many companies are slow to adopt new technologies. As a result, industry recruiters describe building a network in the traditional sense, through social events and other contacts. Mostly, Gen X and Y job seekers are interested in being a part of a team that they feel will make a difference in their world. However, recruiters tend to emphasize the individual aspects of sales and the ability to "be your own boss"-- not the team element. "We know that many of these disconnects are just a lack of understanding by both the job seekers and the recruiters," said Painter Eggers. "Most industry sales positions have significant support through their field managers and other staff support. And while the first five years may be challenging, agents who make it through stay on the job because the industry offers the stability and security second to none." Recruiters who align their message with the job qualities valued by the younger generations will be most successful in overcoming the preconceived ideas about the industry and attract people to a position that is both personally satisfying and financially rewarding," she added. LIMRA serves more than 850 companies in 73 countries, helping them increase their marketing and distribution effectiveness.

Awards highlight Illinois league annual convention

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NAPERVILLE, Ill. (4/12/11)--The Illinois Credit Union League's (ICUL) Keynote and Awards Program honored individuals and credit unions during ICUL's 81st Annual Convention last weekend in Chicago. First place recipients of Desjardins Awards for youth financial education were:
* NuMark CU, Joliet, $50 million-$150 million assets; * Abri CU, Romeoville, $150 million-$500 million assets; and * Great Lakes CU, North Chicago, more than $500 million assets.
Dora Maxwell Social Responsibility Award first-place honorees included:
* Cornerstone CU, $50 million-$100 million assets; * Streator Onized CU, Streator, $100 million-$200 million assets; * GCS FCU, Granite City, $200 million-$500 million assets; and * Great Lakes CU, more than $500 million assets.
Two individuals were inducted into the Illinois Credit Union Hall of Fame, one with a leadership award, and the other for lifetime achievement: Don Leber, board member at Rockford Bell CU, Rockford, and Penni Gebke, ICUL regional director. Louise Herring Philosophy in Action Award winner, in the more than $500 million asset category, was Scott CU, Collinsville. The Spirit of Service award for Employee of the Year went to Phyllis Louis, office manager, Gideon FCU, Waukegan.

CU System briefs (04/11/2011)

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* OAKLAND, Calif. (4/12/11)--An employee of the Alamo, Calif.-based post office was charged with exchanging fake money made in Nigeria for real currency at his cash register and depositing counterfeit bills with Provident FCU's Hayward branch as well as a credit union branch in Oakland. Emmanuel Odion Esezobor, 50, of Hayward did not enter a plea. He is suspected of passing as much as $25,900 in counterfeit currency throughout the area. He allegedly bought money orders with the fake bills that he placed in his cash register and cashed the money orders to pay utility bills. He visited the Provident CU in Hayward twice last year, depositing $1,450 the first time. On his second trip to the credit union to make a $1,200 deposit three fake $100 bills were confiscated San Francisco Chronicle April 9) … * PORTLAND, Maine (4/12/11)--Maine Credit Unions began celebrating April as Youth Financial Education Awareness Month with four Financial Fitness-Money Management Experience events April 5-7 for nearly 1,000 local high school students. According to Jon Paradise, governmental and public affairs manager at the Maine Credit Union League, the fairs reinforce "the commitment and dedication that credit unions throughout Maine have to supporting youth financial education in Maine." He noted that volunteers from more than 30 credit unions participated and that they helped students "understand the importance of making smart financial decisions, in a difficult financial climate." Here, PeoplesChoice CU Board Chair Craig Pendleton assists a Sanford High School senior with his "vehicle" at the Transportation Booth. (Photo provided by the Maine Credit Union League) … * ALBANY, N.Y. (4/12/11)--Corning CU staff hosted four legislators
Click to view larger image Click for larger view
for a tour of its student-run branch, InfoWerx, at the Greater Southern Tier (GST) BOCES Bush Campus. The visitors presented proclamations and letters of recognition. From left are: Assemblyman Christopher Friend (R-Finger Lakes/Southern Tier); InfoWerx alumnus Kurtis Strong; Assemblyman Phillip Palmesano (R-Finger Lakes); Info Werx alumnus Chad Wright; students Bradley Hannula, Justin Evans and Joseph Sabin Jr.; Elmira Deputy Mayor John Corsi; and U.S. Rep. Thomas Reed (R-N.Y.). The Credit Union Association of New York coordinated the branch tour. Info Werx was established in 2008 and is staffed entirely by GST BOCES students, who receive training and support from Corning CU.During their visit, the lawmakers met with staff, alumni who are now attending college, and association staff. (Photo provided by the Credit Union Association of New York) … * LANSING, Mich.(4/12/11)--Mich. Gov. Rick Snyder will for the first time address the Michigan credit union community during the Michigan Credit Union League (MCUL) & Affliates Annual Convention and Exposition May 12-14 in Grand Rapids. The convention will also feature keynoter Stephen J. Dubner, co-author of Super Freakonomics; National Credit Union Administration Chair Debbie Matz; financial analyst and consultant Bert Ely, addressing interchange fees and other challenges; Dr. Paul Isely of Grand Valley State University with an economic forecast for the next 12 months; Anthony Huey, owner of Reputation Management Associates, discussing advanced public relations tactics; and demographer Ken Gronbach, addressing small business lending. MCUL CEO David Adams will provide welcoming remarks. (Michigan Monitor April 11) … * HARRISBURG, Pa. (4/12/11)--Pennsylvania credit unions will sponsor a student-lending event at the state Capitol Rotunda Wednesday. The event is sponsored by the Pennsylvania Credit Union Association (PCUA)and its lending partner, CU Student Choice. Six credit unions will exhibit various types of loans they make available to the state's college students. As state and federal governments cut budgets and reduce funding for higher education, credit unions have stepped up to provide financing for students of public and private four-year colleges and universities, and graduate schools, said PCUA …

Pacific Marine CU acquires bank branch

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OCEANSIDE, Calif. (4/12/11)--Pacific Marine CU in Oceanside, Calif., said last week it acquired a Temecula, Calif., branch of Provident Financial Holdings Inc. of Riverside, Calif. “Provident was looking to move out of that location [in Temecula] and lease a smaller location, because they mostly do just mortgage-related business,” Brad Smith, Pacific Marine vice president of strategic development, told News Now. “So we purchased that building and land.” Pacific Marine is currently leasing a building in Temecula and will move into the building it just purchased from Provident--probably by July, Smith said. The $588 million-asset Pacific Marine CU spent roughly $2.33 million for the Provident branch in Temecula, Smith said.

Two CUs announce branch closures

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RIVERSIDE, Calif. (4/12/11)--Altura CU in Riverside, Calif., and Security Service FCU, based in San Antonio, Texas, announced last Friday they each will close a branch. Altura said it is closing its branch inside the Moreno Valley WalMart Super Center on May 18, converting three other branch locations to all-electronic branches beginning May 10, and eliminating 26 jobs concurrent with the branch changes. The 26 branch positions being eliminated represent 11% of Altura’s work force. “Although the U.S. government reported the recession officially ended in June of 2009, and the nation’s economy is steadily improving, the Inland Empire’s recovery is moving at a slower pace,” said Altura CEO Mark Hawkins. “The Riverside/Inland Empire area appears to be stabilizing, but not yet staging a comeback. Unemployment remains high at 14.1%, which impacts our members’ lives and their ability to repay loans. As a result, Altura’s loan losses peaked in 2010.” Altura restated its 2010 financial results after its auditors recommended boosting reserves for potential loan and lease losses by $3 million. Altura’s restated financials show a loss of $5.8 million for the year on assets of $726.8 million. Originally, Altura reported a loss of $2.9 million for 2010. The restated results are a marked improvement compared to 2009’s net loss of $20.1 million. Altura’s capital ratio for 2010 was also adjusted to 5.81% from the earlier reported 6.18%. The National Credit Union Administration considers 6% to be adequately capitalized. “Although we believe the local economy has begun to stabilize, we felt it prudent to set aside more funds in reserve for potential losses,” said Hawkins. “We also have tightened our loan underwriting standards to limit risk. Unfortunately, that has reduced the number of new loans and the resulting income.” “As a result, we continue to examine ways to further reduce our day-to-day operating expenses," he added. "That is why we made the difficult decision to close our only in-store branch and transition three others to all-electronic locations. The goal is to return Altura to profitability while minimizing disruptions in service to our members." After May 17, Altura will have 12 branch locations in Riverside County, four of which will be all-electronic. Altura also offers online, mobile and telephone banking for its members’ convenience. Also, Security Service FCU will permanently close the Lindon, Utah, Wal-Mart Service Center, formerly a First FCU location, effective May 1. The credit union said it decided to close the branch because of its close proximity to the Security Service branch in Pleasant Grove. The Pleasant Grove branch will offer added services for members, such as four drive-thru lanes, a drive-up ATM, and full teller and member-service operations. The branch closure will not result in any layoffs, the credit union said. Lindon Branch employees are being offered jobs at other area Security Service locations with no change in compensation. Security Service said it is not contemplating any other branch closures in Utah. The $6.2 billion-asset Security Service FCU is based in San Antonio, Texas, and has members in Texas, Utah and Colorado.

MnCUN elects directors at annual meeting

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BLOOMINGTON, Minn. (4/12/11)--The Minnesota Credit Union Network (MnCUN) held its Annual Meeting and Convention Friday and Saturday in Bloomington, Minn., where it elected its board directors.
Click to view larger image During MnCUN’s Annual Meeting on April 8-9, Minnesota Department of Commerce Commissioner Mike Rothman thanked credit unions for their service to Minnesotans and encouraged them to develop strong relationships with the state’s regulatory agency. (Photo provided by the Minnesota Credit Union Network)
More than 460 credit union professionals and volunteers attended, representing 75 credit unions. Also, the meeting welcomed more than 140 individuals from 50 service organizations. At the meeting, featured guest speaker Minnesota Department of Commerce Commissioner Mike Rothman stressed the importance of strong relationships between credit unions and the state’s regulatory agency. He commended credit unions for the value they bring to Minnesota consumers and encouraged them to continue their exemplary service. “On behalf of the governor and the Department of Commerce, thank you for the quality, professional service you provide to the people of Minnesota,” Rothman said. “Value is important to the state, and you bring that virtue to communities through what you do every day.” Rothman also announced his financial literacy roundtable initiative, which will include more than 40 business leaders, nonprofits, legislators and government representatives. The group will examine current financial literacy initiatives and facilitate new ideas and collaboration. He encouraged credit unions to continue their efforts to teach members and communities the principles of financial literacy. Also at MnCUN’s annual business meeting, three incumbents and two new representatives were elected to three-year terms on the MnCUN board of directors:
* Daniel Stoltz of SPIRE FCU in Falcon Heights, to represent credit unions in Minnesota’s seven-county metro area; * Tammy Heikkinen of Members Cooperative CU in Cloquet, who will continue to represent credit unions outside of Minnesota’s seven-county metro area; * Paul Knorr of Accentra CU in Austin was elected to represent credit unions outside of Minnesota’s seven-county metro area; * Karen Fleming of HBI Employees CU in St. Paul was re-elected and will continue to represent credit unions with 2,000 or fewer members; and * Kyle Markland of Affinity Plus FCU in St. Paul, who will continue to represent credit unions with more than 10,000 members.
The MnCUN also re-elected its table officers for 2011:
* Chairman--Markland; * Vice Chairman--Patrick Pierce of City & County CU in St. Paul; and * Secretary/Treasurer--Chuck Albrecht of Mid-Minnesota FCU in Brainerd.

Herring Society raises 50K for Ohio Foundation

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COLUMBUS, Ohio (4/12/11)--The William A. Herring Society has raised more than $50,000 for the Ohio Credit Union Foundation (OCUF). The newly announced planned giving opportunity, which recognizes employees and volunteers who have shown a commitment to credit unions, honors Bill Herring, CEO of Cincinnati Central CU, as the inaugural inductee. The unveiling was announced before more than 500 attendees during the Ohio Credit Union League’s annual conference, InVest48. All funds contributed to the William A. Herring Society will be used by OCUF to support credit union social responsibility initiatives that reach people of modest means. “The honor of being inducted into the William A. Herring Society is bestowed upon individuals who are, or have been, key credit union leaders. Their passion, integrity, and leadership have made a lasting impact on their credit union and its members,” said Tom Furrey, OCUF chair and CEO of Western CU, Columbus. Herring is a charter member of the OCUF Board of Trustees and was instrumental in its founding. He has also served in numerous state and national credit union leadership positions. “His credit union outreach program in the Over the Rhine section of Cincinnati is a national and global model,” said Furrey. “Credit unions are needed now more than ever. We must be truly motivated by what is best for the member, and give equal citizenship to the social mission of credit unions. I am overwhelmed that my family name will be forever linked to a program which has the potential to do so much good to reach out and help people of modest means,” Herring said. Furrey introduced the first Herring Society inductees, the four former chairs of OCUF, who were all present to receive an engraved silver medallion from Herring: Willard Hopkins, CEO of First Miami University Student & Alumni FCU, Oxford; Tim Mislansky, senior vice president of Wright-Patt CU, Fairborn; Rose Bartolomucci, CEO of TeleCommunity CU, Akron; and Kathy Kanipe, CEO of Parish FCU, Toledo. Four credit union-sponsored inductees also were recognized during the ceremony: Richard English, 24-year board member of MidWest Community CU, Defiance; Bruce Campbell, credit union advocate from Superior FCU, Lima; Robert Hallier, 25-year board member from CSE FCU, Canton; and Howard Smith, 19-year board member and former interim CEO of Western CU, Columbus. Donations to the society were made by American Share Insurance, Corporate One FCU, the OCUF, and the Ohio Credit Union League Services Corp.

Biz Kid close NYSE launch five episodes

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NEW YORK (4/12/11)--Representatives from Biz Kid$, the Emmy-award winning financial literacy series on public television, rang the New York Stock Exchange closing bell Monday to celebrate the launch of five new episodes this month. Lauren du Pree, one of the show’s hosts, and Roxanne Kruger, vice president of the Washington Credit Union Foundation, rang the bell. They were joined on the bell podium by Jamie Hammond and Jeannine Glista, executive producers of Biz Kid$, along with eight young entrepreneurs from Chicago, Boston, Washington D.C., and New York who have been featured on the series. While in New York, the group was interviewed live on Fox News Online about business, financial literacy and Biz Kid$. Biz Kid$ is a national financial literacy initiative, which includes a TV series, outreach activities, free curriculum, a website and a monthly newsletter. It is sponsored by America’s credit unions.

Illinois league elects officers directors

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NAPERVILLE, Ill. (4/12/11)--Elections by the Illinois Credit Union League (ICUL) and its affiliated organizations were held during the league's 81st Annual Convention, which ended Saturday in Chicago with 750 executives representing 110 credit unions attending. League officers, elected to a second one-year term, and a new league director are:
* Chairman, Dennis Hall, CEO, I.H. Mississippi Valley CU, East Moline, who also will continue to serve as League Service Corp. (LSC) chairman; * Vice chairman, Geraldine Burek, CEO of South Division CU, Evergreen Park, who will continue as LSC vice chairman; * Secretary/treasurer, Pete Paulson, CEO of Corporate America Family CU, Elgin. * New director, Melanie Macy, collection manager, Blackhawk Area CU, Savanna, who will represent the Northwest Illinois Chapter of Credit Unions.
Click to view larger image Illinois Credit Union Foundation officers and new board member include, from left: Foundation chairman, Greg Worthen, director of lending, 1st MidAmerica CU, Bethalto; Secretary Treasurer Tom Pierce, CEO, Canals & Trails CU, Lockport; Peggy Cummins, CEO, Three Rivers Community CU, Mt. Carmel; Tom Lex, chief operations officer, Heartland CU, Springfield; Janet Francoeur, CEO, Riverside Community CU, Kankakee; Geraldine Burek, CEO, South Division CU, Evergreen Park; John Fiore, CEO, Motorola Employees CU, Schaumburg; and Michael Lee, president, Midwest region, Members United Bridge Corporate FCU, Warrenville. Not pictured is foundation Vice chairman David Mooney, CEO, Alliant CU, Chicago.
Click to view larger image The Illinois Credit Union Political Action Committee (CUPAC) new officers and board members are, from left: Seated, Brenda Crane, CUPAC vice chairman and chief operations officer, Credit Union 1, Rantoul; Christine Dickover, CEO of H-F CU, Country Club Hills; John Fiore, CUPAC chairman and CEO, Motorola Employees CU, Schaumburg; Karen Woods, marketing director, Decatur Earthmover CU, Decatur; and RaeAnn Love, CEO, Commonwealth CU, Bourbonnais. Standing, Mike Frye, chairman, Shell Community FCU, East Alton; Pete Fauth, CUPAC secretary and vice president/chief financial officer, Financial Plus CU, Ottawa; Tom Enos, CUPAC treasurer and business development director, First Northern CU, Chicago; Robert Schroeder, CEO, Illinois Community CU, Sycamore; and Frank Padak, CEO, Scott CU, Collinsville. (Photos provided by the Illinois Credit Union League)
Illinois Credit Union Foundation officers and a new director elected include:
* Chairman, Greg Worthen, director of lending, 1st MidAmerica CU, Bethalto; * Vice chairman, David Mooney, CEO, Alliant CU, Chicago; * Secretary/treasurer, Tom Pierce, CEO, Canals & Trails CU, Lockport; and * New director, Tom Lex, chief operations officer, Heartland CU, Springfield, elected to fill an unexpired term, which ends 2013, due to a retirement.
New officers for the Credit Union Political Action Council (CUPAC) include:
* Chairman, John Fiore, CEO, Motorola Employees CU, Schaumburg; * Vice chairman, Brenda Crane, chief operations officer, Credit Union 1, Rantoul; * Treasurer, Tom Enos, business development director, First Northern CU, Chicago; and * Secretary, Pete Fauth, vice president and chief financial officer, Financial Plus CU, Ottawa.
Elected to the Illinois Youth Involvement Council (IYIC) executive committee are:
* Chairman, Shelli Chesnutt, president/CEO, Aurora Policemen CU, Aurora; * Vice chairman, Jeri Hansen, president, Danville Consolidated CU, Danville; and * Secretary/treasurer, Wednesday Medlen, business development and membership officer, Community Plus FCU, Rantoul.

Interchange rule would hurt members says N.C. op-ed

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WINSTON-SALEM, N.C. (4/11/11)--The proposed rule on capping interchange fees for debit cards "would put local credit unions at a serious competitive disadvantage" and increase costs for those who use debit cards, said an opinion-editorial written by Marcus Schaefer, president/CEO of Truliant FCU, Winston-Salem, N.C., and published in Thursday's Winston-Salem Journal. The provision known as the Durbin Amendment was passed "without a single hearing, no vote in the U.S. House and little discussion in the Senate," Schaefer said in the article. "Credit unions are owned by their members, and the lost revenue directly impacts the rates we pay on savings, the rates we charge on loans and the fees we have to charge to cover service costs," Schaefer wrote. "Although Truliant will attempt to minimize the impact on our members, consumers generally can expect new fees associated with their debit cards, limits on the amount or number of purchases and elimination of rewards programs and other benefits," he said. Schaefer noted that credit unions use retailers' interchange payments to cover the cost of issuing cards, accessing and maintaining the interchange system and providing services to members. "Big out-of-state banks and major financial institutions can more easily absorb the reduced revenues, potentially resulting in an unfair, two-tiered system where debit cards from local credit unions are more expensive to use. Retailers, in turn, may discriminate against these local cards, inconveniencing members and driving credit unions out of the market. Our member-friendly, no-cost debit card programs could be at risk." He likened the interchange rule to a hardware store being told to charge only the cost of the parts of the lawnmower it sells. Price controls generally stifle competition, impede innovation and hurt consumers, he wrote. "There is also concern that the real impact could be to force modest-means consumers out of the traditional banking system at the worst possible time." Schaefer concluded by urging legislators to "favor reviewing the issue further before allowing implementation." To access the entire article, use the link. The Credit Union National Association is supporting new bills recently introduced in the Senate and House that would delay implementation of the interchange fees provision until further study is made of the rules' unintended impact.

E-mail breach Has it hit just about everyone

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MADISON, Wis. (4/11/11)--Almost everyone seems to know someone whose name and e-mail address was among the millions compromised in a hacking of Epsilon, the world's largest e-mail marketer. Security experts and credit unions warned last week that consumers will see a sharp hike in phishing e-mails--especially targeted or "spear" phishing. Just how big is this breach, and how will it affect credit unions and members? Some say it likely will top the largest breach in history--the Heartland Payment Systems breach of 40 million accounts disclosed in 2009. Epsilon's parent company, Alliance Data Systems Corp., discovered the breach on March 30 and said it affects roughly 2% of its 2,500 clients. However, more and more of its clients are notifying their customers they were among the addresses compromised. Epsilon's clients include some of the world's largest retailers, banks and financial service companies, and telecommunications companies: Capital One Financial, Barclays Bank, U.S. Bancorp, Citigroup, Ameriprise Financial and JPMorgan Chase, Verizon, Charter Communications, TiVo, Best Buy, Walgreens, Kroger and Kraft Foods (AOL's and New York Post April 4, April 3 and April 8). Both security experts News Now interviewed agreed that the breach's impact will grow. "There's not a final answer yet [as to how many names and addresses were compromised] but likely it is more widespread than initially believed," said Brian M. Otte, senior vice president of corporate development at Perimeter, a security solutions firm headquartered in Milford, Conn., and a CUNA Strategic Services provider. Jay Liebe, director of integration at Las Vegas-based Switch SuperNAP, a provider of facility and network security and a CUNA Strategic Services provider, agreed. "I absolutely don't believe that all the problems have been disclosed," Liebe said, noting that Epsilon is "clearly on damage control, much like those in charge of Japan's nuclear reactors" affected by the catastrophe there. The breach's direct effect on the credit union market is not yet clear. "Initially, it was a couple of companies, but now it is effecting more and more companies," Otte said. Is the type of information stolen that serious? Opinions vary. Otte points out that names and addresses can be easily found through other sources and emphasized that "no financial information has been compromised. However, the hackers have access to e-mails and will use them to phish--an action that involves sending phony e-mails and collecting numbers from unsuspecting consumers." Names and e-mail addresses are all a hacker needs to send "targeted" phishing attacks against a specific brand. While many phishing expeditions rarely hit recipients who are actually customers of the company they claim to be, targeted phishing ensures recipients are customers of the company they're attacking. And that could trick recipients into disclosing more information that can be used in identity theft. Liebe says the breadth of scale of the companies involved indicates Epsilon was "careless" about differentiating different industries' information. "Clearly Epsilon had to have a flaw in its architecture to expose the kind of data it did and to expose such a wide area," he said. "There are many wonderful companies in credit unions' space who do a phenomenally successful job with security so they are able to protect their members' data," he told News Now. The fact that Marriott, Verizon and bank data are lumped together indicates they may not have treated sensitive banking data differently, Liebe said. "The data they had relate to their businesses, and Epsilon mixed it all together. I don't believe credit unions as a whole have their marketing services in that kind of setup." Both experts said credit unions can take specific steps to make sure their members don't succumb to the wiles of the people who hacked Epsilon's database. "First, they should alert their members and explain that they are not going to ever be asking for any sensitive information. Train members not to respond to the e-mails, not to give out their passwords, not to give out their Social Security numbers," Otte said. "Second, get an anti-phishing system or service so the credit union can be proactive in tracking to see if any phishing schemes are using their name," Otte added. Liebe advised that "credit unions share [with members] the hard work they do with security providers to make sure the data can't be shared and compromised. Credit unions don't give their data out like Epsilon did."

WOCCU conference serving up bacon eggs experts

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GLASGOW, Scotland (4/11/11)--The World Council of Credit Unions (WOCCU) will be serving up Bacon, Eggs & Business Experts first thing in the morning at its 2011 World Credit Union Conference, which will be held July 24-27 in Glasgow, Scotland.
The two-part breakfast series aims to help uncover ways to make the credit union more effective and more successful, with insights and advice from two business authors. Julian Birkinshaw is a professor of strategic and international management and deputy dean for programs at the London Business School. Birkinshaw is author of 11 books, most recently Reinventing Management. Over breakfast, he will discuss why high-quality management matters more than ever and how credit unions can make smarter choices and become more innovative in how they operate. Christian Stadler is an expert on long-term success and author of Enduring Success: What We Can Learn from the History of Outstanding Corporations, the first book with a non-U.S. perspective on long-range success. During breakfast , Stadler will share insight on why some companies have enjoyed stellar performance decade after decade, overcoming setbacks and making relentless progress. For more information, use the link.

Connecticut league announces new board

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MERIDEN, Conn. (4/11/11)--The Credit Union League of Connecticut has announced its board of directors and officers for 2011-2012. New board members are:
* Kathy L. Chartier, CEO, Members CU, Stamford (three-year term); * Edward V. Crowley Jr., CEO, Fairfield (Conn.) Municipal FCU, (two-year term); * John Dolan, chief lending officer, Charter Oak FCU, Groton (one-year term); * James N. Farrell, CEO, New Haven County CU, North Haven (one-year term); * Garrett R. Gizowski, CEO, United Shoreline FCU, New Haven (one-year term); * John E. Keet, Jr., CEO, Personal Care America FCU, Trumbull (three-year term); * Carl Skudlarek, manager/CEO, Bridgeport City Employees FCU, Bridgeport (two-year-term); * Joanne Todd, president/CEO, Northeast Family FCU, Manchester (two-year term); and * Keith Wiemert, president/CEO, Seasons FCU, Middletown (three-year term).
In 2009 the league Board of Directors Governance Committee surveyed affiliated credit unions proposing a restructuring of the director election system for the board. Changes in bylaws, approved by the membership in 2010, include a reduction in number from 12 chapter directors and six alternate directors to six chapter directors and three at-large directors to streamline board governance and provide a more equitable representation of the state’s credit unions, said the league. Officers for 2011-2012 are:
* Chair, Todd; * Vice chair, Wiemert; * Secretary, Chartier; and * Treasurer, Skudlarek.
The election took place following the league’s Annual Meeting April 5 in Plantsville, Conn.

Minnesota foundation grant funds teachers fin. ed

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ST. PAUL, Minn. (4/11/11)--The Minnesota Credit Union Foundation (MnCUF) has partnered with the University of Minnesota Extension (UMES) to create a series of webinars to teach educators about personal finance. The project’s goal is to help educators develop a higher level of confidence to teach personal finance to Minnesota youth. Through grant funding, UMES will produce a series of two-hour webinars using the National Endowment for Financial Education’s (NEFE’s) High School Financial Planning Program curriculum. The project, to be completed by the end of the year, will be free to anyone who works to improve the financial literacy levels of students--including educators and credit union professionals. “Studies show that teachers are not confident in their knowledge and competency in financial content topics,” said Patricia Olson, UMES associate director, family development and extension. “Our goal is to reach teachers with the NEFE curriculum and to provide additional content to help teachers feel confident in this extremely critical--but often intimidating--subject.” The project marks a shift in MnCUF’s overall objectives, with an emphasis on financial education as part of its core mission. “Clearly financial education is important to so many groups, organizations and individuals, which is illustrated by countless initiatives taking place around the state and the country,” said MnCUF Chair Pat Brekken. “Credit unions have told us that financial literacy is a subject of tremendous importance to them.” Webinars will be offered in “live” format and archived online for future use, allowing for training across numerous organizations and school districts.

CU System briefs (04/08/2011)

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* SUMMERVILLE, S.C. (4/11/11)--An ATM belonging to South Carolina FCU in Summerville sustained $3,000 in damage after someone used a blow torch to try to break into the machine on April 5. A similar incident was reported to police by a local bank on April 4. Police, on arrival, found five burn holes and melted plastic around the lock of the ATM's access door. The would-be thief was unable to breach the door of the ATM's steel safe. A temperature alarm on the machine did not activate because the culprit used a small torch. The incident was discovered by a contractor who maintains the machine (abcnews April 7) … * ALBANY, N.Y. (4/11/11)--Teens from Pittsford Mendon High School beat nine other high school teams to capture the 2011 New York State LifeSmarts Championship in Schenectady, N.Y. The event is coordinated in New York State by the New York Credit Union Foundation as an educational opportunity for students in grades 6-12. Runner up was Smithtown High School West. Shown here with Diane Lavigna-Wixted, left, foundation executive director, and former WRGB-TV anchor and quiz master Jack Aernecke, right, are, from left, winners Kylie Ryan, Denver Rawlins, Allison Hallock, Team Captain Stefan Styk; and Steven Pan. (Photo provided by the New York Credit Union Foundation) … * ALBANY, N.Y. (4/11/11)--National Credit Union Administration (NCUA) Board Chair Debbie Matz will address credit union leadership at the Credit Union Association of New York's 2011 Annual Meeting and Convention on June 3 at the Conference Center at Lake Placid, N.Y. Matz will discuss the agency's ongoing efforts to reform the credit union system and provide an update on key regulatory issues. The theme of the June 2-5 meeting and convention will be Credit Unions: Standing Tall … * VACAVILLE, Calif. (4/11/11)--Travis CU was presented the Seven Seals Award by the California Committee for Employer Support of the Guard and Reserve (ESGR) at a brief ceremony March 21 at the Travis Regional Armed Forces Committee luncheon. The award, named for the heraldry seals of the seven military services, recognizes efforts by citizens, businesses and organizations whose actions have helped reservists in all branches. Patsy Van Ouwerkerk, CEO of the Vacaville, Calif.-based, $1.8 billion asset credit union, signed a Statement of Support for the National Guard and Reserve prior to the award presentation. From left are Van Ouwerkerk; Andrew C. Wiktorowicz, California state chairman, ESGR; and Robert Anderson, Region 1 chair Northern California, ESGR. (Photo provided by Travis CU) …

CUs continue efforts to assist government employees

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MADISON, Wis. (4/11/11)--Credit unions with close ties to federal workers continued to play an integral role in preparations Friday for a possible government shutdown at midnight Friday. However, Congress avoided the shutdown by striking a budget deal an hour before the deadline. An article in the The New York Times (April 8) noted how credit unions prepared early for the possible shutdown and began offering furlough loans and similar financial assistance to some of the 800,000 government employees who would have been sidelined by a shutdown. The Credit Union National Association provided information for the article, which specifically described how NASA FCU would offer a 0% interest paycheck and furlough relief loans. Members of Transportation FCU, Washington, D.C., can apply for loans up to $3000 or two weeks of net pay, it said. Below the national media radar, credit unions nationwide serving federal workers were putting similar plans in place. Although they won't have to implement the special assistance, here is a rundown on what they had planned. The South Carolina Credit Union League reported that four of its member credit unions would extend services to affected federal workers:
* Palmetto Trust FCU, Columbia, offered a 30-day, 0% annual percentage rate (APR) loan for missed direct pay deposits during a shutdown. For members without direct-deposited pay, the same loan was offered at 3.5% APR. Loans were eligible for 30-day extension or reissue until the shutdown ends. * SPC CU, Hartsville, offered a 0% APR loan in lieu of net pay. * Members of CPM FCU, North Charleston, were told they could get a furlough loan for up to $2,000 with the first payment due in 60 days. There were no credit requirements or risk-based characteristics. * Charleston Area FCU said it would offer deferred payments on existing loans until affected members are paid, and would extend to eligible members on direct-deposit an interest-free, single-pay loan of up to $3,000 for those who would receive retroactive pay. Federal employees who would not receive pay for the shutdown period could request an unsecured loan.
In Portsmouth, N.H., Service CU was planning to credit direct deposit and allotments for military and government service members affected by a shutdown. The credit union also would provide a 0% loan rate with up to a 30-day payback and a line of credit up to members’ direct deposit amounts. Belvoir FCU, Woodbridge, Va., offered furlough emergency loans up to $5,000 with payment deferred for the first 60 days. The credit union also offered a skip a payment option for members who have loans and personal financial consultation services. At Hanscom FCU, Hanscom Air Force Base, Mass.,members whose paychecks were affected by a furlough would have access to a 0% APR interest line of credit equal to one month’s net payroll up to $5,000. Dubbed the Life Line Loan, this interest-free loan was attached to a member’s checking account to provide additional funds to cover checks, ATM withdrawals and debit card purchases. Also, the credit union said it would waive penalties for premature withdrawals on certificates of deposits for affected members. Justice FCU, Chantilly, Va., provided a furlough relief loan up to $3,000 at a 0% interest rate for 60 days. Loan amounts would have been based on the member’s net paycheck and require direct deposit with the credit union. Global CU, Spokane, Wash., offered members employed by the federal government interest-free loans to cover delayed pay checks and said it would extend auto loan and credit card payments without fees. Andrews FCU, Suitland, Md., announced it would advance mid-month pay on April 15 to active duty military members who had direct deposits. The credit union also offered 0% APR loans to other federal employees who have direct payroll deposits. The loans would have a 30-day term for repayment.

Ohio CUs raise 130000 for kids hospital

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COLUMBUS, Ohio (4/11/11)--Credit union leaders in Ohio presented $130,500 to Children’s Miracle Network Hospitals as a result of their annual statewide fundraising march to benefit children’s hospitals. The contribution brings Ohio credit unions’ five-year total since the inception of “Marching Miles for Miracle Kids” to a half-million dollars.
Click to view larger image At the Children’s Miracle Network Hospitals check presentation at the Ohio Credit Union league's InVest48 conference Tuesday in Columbus, Ohio, are, from left: Joe Dearborn, Children’s Miracle Network Hospitals; Akeia and Melody Evans; Kristina Hurlburt of Standard Register FCU, Dayton; and Judy Andrews of State Transportation Employees CU, Columbus. (Photo provided by Ohio HealthCare FCU)
The Evans family, ambassadors for Nationwide Children’s Hospital, and Joe Dearborn, senior director of Credit Unions for Kids, accepted the check on behalf of CMN Hospitals. The eldest child in the Evans family has been treated for cancer at Nationwide Children’s and has been cancer free for three years. More than 400 credit union professionals statewide shared in the announcement of this year’s grand total at the Ohio Credit Union League’s InVest48 conference held in Columbus, Ohio, Tuesday. Led by the Ohio Credit Union League’s Credit Unions for Kids Committee, the annual Ohio Credit Unions: Marching Miles for Miracle Kids walk-a-thon raises money for the nine children’s hospitals that serve Ohioans. The march kicked off in Cincinnati March 28, with walks following daily in Dayton, Toledo, Cleveland, Akron, Youngstown and Columbus. “We look forward to this event every year,” said Jaime Crooks, committee chair. “It’s our chance to collaborate together and show our true ‘People-Helping-People’ cooperative spirit.” Children’s Miracle Network Hospitals generates funds and awareness programs in partnership with and for the benefit of member hospitals/foundations and the children they serve. Organizations, media partners and individuals unite with Children’s Miracle Network Hospitals to help sick and injured kids in local communities. Donations to Children’s Miracle Network Hospitals fund specialized medical care, research and education.

N.C. lawmakers introduce prize-linked savings bill

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RALEIGH, N.C. (4/11/11)--The North Carolina Credit Union League is closer to a prize-linked savings program after legislation introduced this week in the state legislature. The league has been exploring the idea of launching the Save to Win prize-linked savings program first piloted in Michigan in 2009. Legislation introduced Tuesday in the North Carolina House of Representatives and Wednesday in the state Senate will give credit unions the needed change to make the program a success in North Carolina (Weekly Update April 8).
As the North Carolina House and Senate introduced legislation last week to allow credit unions to offer a prize-linked savings program in North Carolina, some 20 grassroots advocates met Wednesday with lawmakers in Raleigh. Pictured, from left, are: John Bell, North Carolina Community FCU, Goldsboro; Beatrice Williams-Louis, Fort Bragg FCU, Fayetteville; State Rep. Efton Sager (R-11); and Alexandra Boncek, North Carolina Credit Union League. Sager sponsored the North Carolina House version of the prize-linked savings bill. (Photo provided by the North Carolina Credit Union League)
The program provides incentives to help participants save, including an opportunity to win monthly prizes or a headline-grabbing grand prize. With every $25 dollar deposited into the Save to Win account, the saver is entered for the monthly and annual grand prize drawing, with a 10-entry limit per month. Now in its third year, Michigan program has opened more than 28,500 Save to Win accounts with $37 million saved, said the North Carolina league. “Michigan found that individuals who had not saved regularly before were encouraged by the possibility of winning,” said John Radebaugh, league president/CEO. “If credit unions here could launch this safe and exciting program, we could encourage new savers and promote new savings habits for North Carolinians.” Current law in North Carolina limits credit unions to holding two raffle drawings per year. The league concluded that asking for a legislative fix would ultimately enhance the success of Save to Win there. “After the start of 2011-2012 session, we approached our state lawmakers with the innovative savings concept and asked for an exemption for credit unions so that monthly prizes could be awarded,” said Lauren Whaley, the league’s director of legislative and regulatory affairs. “The level of support we have received from legislators shows the value of Save to Win in promoting stronger financial futures for credit union members.” The bipartisan bill faces no opposition. The Senate bill, SB 513, will now move to the Commerce Committee and HB 583 will move to the Banking Committee.

Court dismisses Heartlands acquiring banks from breach suit

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HOUSTON, Texas (4/17/11)--A U.S. District Court in Houston, Texas, has dismissed two acquiring banks as defendants in a lawsuit brought by four credit unions and a bank related to the 2008-2009 Heartland Payment Systems' data breach. However, the court suggested that the complaint against one bank be transferred. U.S. District Judge Lee H. Rosenthal of the Southern District of Texas rendered the decision on March 31. Heartland's two acquiring banks--Heartland Bank and KeyBank N.A.--process payments for the merchants who make credit-card sales. They hired Heartland as their processor. In a credit card transaction, acquiring banks contact the card-issuer banks to clear the transaction if there is enough credit in the consumer's account. The four "issuer banks" who brought the suit are Lone Star National Bank, N.A.; PBC CU, based in West Palm Beach, Fla.; O Bee CU, based in Tumwater, Wash.; Seaboard FCU, Bucksport, Maine; and Pennsylvania State Employees CU, Harrisburg, Pa. They sued the banks for breach of contract, breach of fiduciary duty, and negligence based principally on the banks' alleged failure to monitor the security of the card processing system's database and ensure the card processor complied with the Payment Card Industry Data Security Standards. Heartland Bank, based in Clayton, Mo., and KeyBank, based in Ohio, both moved to dismiss the case for failure to state a claim on which relief can be granted. Heartland Bank also moved to dismiss for lack of personal jurisdiction in the state of Texas. The court granted Heartland's motion to dismiss on the first point, but concluded "that transfer [of the case from Texas to another court jurisdiction], not dismissal, is the appropriate remedy." Ohio-based KeyBank's motion was also granted, "with prejudice as to the negligence claim and without prejudice as to the remaining claims." The breach, which was announced by New Jersey-based Heartland Payment Systems in January 2009, is the largest data breach on record, with more than 130 million credit and debit cards compromised. As a result, many financial institutions, including credit unions, had to reissue their member/customers cards to prevent fraudulent charges. Many saw fraudulent charges on cards. Multiple lawsuits prompted by the hacking were consolidated into two tracks: one for consumers whose card numbers were accessed, and one for financial institutions that issued the cards that were compromised in the hacking. The financial institution track lawsuit involves two complaints: one against Heartland Payment Systems, and one against the two acquiring banks. A status conference on the case was scheduled for April 18.

Federal shutdown CUs stand ready to assist members

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MADISON, Wis. (4/8/11)--Credit unions nationwide are preparing to serve members with urgent financial needs in the event of a federal government shutdown at midnight ET today. Federal agencies cannot operate without spending authority provided by Congress, and that authority expires tonight for most agencies. The shutdown could keep as many as 800,000 federal employees from working--and from receiving paychecks at least temporarily. The National Credit Union Administration (NCUA) Thursday issued a letter urging credit unions to remain ready and flexible to address the financial needs of federal workers and other individuals affected by any impasse on federal spending. For more details, please use the link. Credit unions reported to the Credit Union National Association (CUNA) Thursday that they are well-prepared to meet members’ needs. “We continue to receive reports of credit unions readying skip-a-payment options, temporary 0% financing and other special programs to help the federal employees in their membership cope if there is a government shutdown,” said CUNA President/CEO Bill Cheney. “Credit unions are owned by the members they serve. This is a great example of credit union philosophy in action--stepping up to help their members when their members need them most.” Labor Dept. FCU, Washington, D.C., is offering members 12-month loans up to $3,000, with the first 60 days interest free in the event of a government shutdown. “We call it a payroll disruption loan,” CEO Joan Moran told News Now. “If payroll does get stopped, members can keep their day-to-day living expenses going. Once payroll gets started, they can pay us back. Hopefully, without interest.” Moran said members have contacted the credit union, mainly to inquire about access to service if the government shuts down. The credit union’s Web home page features a red banner with bold white lettering, “In case of a government shutdown, we’ve got you covered.” One click away is a list of access options that includes e-mail, courtesy pay, online banking and shared branching. The Department of Labor has given credit union employees permission to access the Frances Perkins Building if there is a shutdown so the credit union can provide members with essential services. As the CEO of a credit union that serves government employees, Moran said her credit union is prepared for a shutdown. “We’ve been watching this for months,” she said. “I think we first started talking about it in January. We’ve been building up liquidity so we can provide funding however it’s needed.” At HEW FCU, Washington, D.C., any loan payments made by government payroll will be skipped for the next payroll period if there’s a shutdown, according to CEO Kathy Geary, who said the credit union would re-evaluate the policy before the next payroll. Members with direct payroll deposits can also obtain interest-free loans and pay them back when they resume their jobs. If they wish to carry the loans longer, the terms are 3% for three months or 4% for six months. Members were relieved when they learned the credit union was providing some financial relief, Geary said. “A lot of them said, ‘A bank wouldn’t do this for us,’” she added. Geary said HEW FCU was much better-prepared because the credit union went through another government shutdown in 1995-96. “We pretty much took out the boxes from 15 years ago, dusted them off and looked at what we could apply to members today,” Geary said. Cabrillo CU of San Diego is offering 0% loans to members on direct deposit from the federal government. Loans not paid when the furlough is lifted convert to 12-month loans with 7% annual percentage rate (APR). Cabrillo CEO Robin Lentz said her credit union had not received many inquiries as of Thursday morning, but she expected that to change as the deadline approaches. Like HEW FCU, Cabrillo CU went through a government shutdown in 1995-96. Lentz is most concerned about the impact the shutdown will have on her staff, which could be inundated with urgent requests from stressed out government employees. “We have more automation now, which helps, but last time we were overwhelmed,” Lentz said. Frederick. Md.-based COMSTAR FCU’s contingency plans for the federal government shutdown/furlough include: loan payment modifications, such as temporarily reduced payments, skipped payments or interest-only payments; a low-rate shutdown/furlough loan to tide workers and their families over until paychecks resume; and additional staffing at branches that will remain open during a shutdown/furlough. The credit union also is offering a furlough information line staffed with trained personnel to assist workers with specific questions and problems. Jennifer Stillrich, marketing and training manager at COMSTAR FCU, said it’s helpful that some of the credit union’s branches are located outside of federal buildings, so they can stay open in a shutdown. “We know from experience that when the federal buildings are closed, it’s a lot harder for everyone,” she said. Other efforts from credit unions serving federal government employees include:
* NASA FCU, Upper Marlboro, Md., is offering federal government members, including contractors, a 0% interest paycheck and furlough relief loan to cover delayed paychecks or furloughs. * Interior FCU, Washington, D.C., is running a $25 membership promotion and will offer a 0% line of credit for 15 days. * At Transportation FCU, Washington, D.C., furloughed employees can skip up to two monthly payments per loan on consumer loans and credit cards. The credit union also offers a “FurDough” loan of up to two weeks of net pay, up to $3,000 at a 4.5% APR for up to 18 months with a minimum payment of $25; * At Associated CU, Norcross, Ga., government employees using direct deposit can apply for 0% interest loans in the amount of their last direct deposited paychecks. If the balance cannot be paid within the 30 days after government payrolls begin, loans will be converted to 12 months at 5.5% APR.

W.Va. newspaper editorial Interchange needs more study

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HUNTINGTON, W.Va. (4/8/11)--A prominent Huntington, W.Va., newspaper has sided with credit unions regarding debit card interchange fees, saying the matter needs more study before any change to the fee structure is made. “The proposal is to cut the fees to the retailer from an average of 44 cents per transaction now to about 12 cents,” said The Herald-Dispatch (April 4). “But there is a growing concern that the Fed did not look at the ‘big picture’ when it developed the lower limits. Some argue that the legislation, which was proposed as a benefit to consumers, may have just the opposite effect. Consumers could end up paying more for their debit-card use or seeing restrictions on that use. The higher consumer fees could have a big impact on lower-income families. “That is certainly the way the plan is viewed by representatives of many smaller banks and credit unions, which typically have a higher per transaction cost than big banks,” the editorial added. U.S. Rep. Shelley Moore Capito (R-W.Va.), who is leading the effort for a bipartisan bill that would delay the proposal’s implementation for a year, said the matter deserves another look, the editorial noted. Availability issues, credit issues and lower-income people having more charges on checking accounts and therefore lower use of their debit card are ramifications that weren’t considered in the original rule, or the amendment. Therfore, Congress should postpone any ruling to obtain a more accurate study, Capito said last week, reported the newspaper. The newspaper agreed. “That [Capito’s viewpoint] makes a lot of sense. One thing we have learned from the country’s recent financial problems is that what is best for the largest businesses is not always best for everybody. This plan needs another review,”’ the editorial concluded. And, in another prominent West Virginia newspaper, The Charleston Gazette, Kenneth R. Watts, president of the West Virginia Credit Union League, wrote a letter in March that also agreed with Capito’s position on interchange. “Congresswoman Capito and her colleagues have it right by slowing this process down and proceeding cautiously,” Watts wrote. “Credit union members, and bank customers who rely on their debit cards to make essential purchases without writing checks, should not have to pay higher fees especially since debit cards help increase sales and provide convenience to merchants who voluntarily accept them. Also, these financial institutions assume all of the risk of fraud and provide immediate payment to merchants. “Now is not the time to raise unnecessary fees on consumers. It is time to thank lawmakers like Congresswoman Capito who want to proceed carefully on this matter,” he concluded. The Credit Union National Association (CUNA) opposes the cap on interchange fees and has told federal lawmakers that such action would limit consumer options, competition and technological innovation. Interchange fees allow business costs, including the risk of consumer nonpayment, to be shared by the payments participants, CUNA says. To read the editorial and letter, use the links.

CUNA Small CU Committee posts resources video on website

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MADISON, Wis. (4/8/11)--The Credit Union National Association’s (CUNA) Small Credit Union Committee has posted some new resources and additions to its website. The committee held it first-ever Small Credit Union Roundtable on Feb. 27--the first day of CUNA’s annual Governmental Affairs Conference in Washington, D.C. The purpose of the committee and roundtable is to address issues of concern to small credit unions, such as collaboration, regulatory compliance and how to lower costs to serve their members better (News Now Feb. 28). Mike Schenk, CUNA vice president of economics and statistics and CUNA’s liaison to the committee, has announced these website additions and updates:
* A 15-minute video update (go to website link below to download video) that discusses recent committee activities--including details of a February meeting with National Credit Union Administration Chair Deborah Matz--and points small credit unions to helpful resources and material available to them; * Audio clips of the proceedings at the Feb. 27 Small Credit Union Roundtable, made possible with support by CUNA Mutual Group; * A quarterly financial wrap-up for small credit unions, consisting of a Small Credit Union Profile report that summarizes key ratios and trends using recently released call report data; and * A continuous posting of minutes from committee meetings, including an archive of past meetings.
To access the website, use the link.

Connecticut league meeting attracts 200 attendees

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MERIDEN, Conn. (4/8/11)--The 2011 Annual Meeting of the Credit Union League of Connecticut Tuesday provided interactive activities for nearly 200 credit union attendees in Plantsville, Conn.
Click to view larger image Kelly Fuhlbrigge (left), Credit Union League of Connecticut vice president, Government Relations; and Tony Emerson, (right), league president/CEO; flank Connecticut Attorney General George Jepson following his address at the league’s annual meeting.
Click to view larger image Tony Emerson, (left), president/CEO of The Credit Union League of Connecticut, presents the 2011 Connecticut Credit Union Professional of the Year Award to Robert L. Aresti, president/CEO of 360 FCU, Windsor Locks, Conn. (Photos provided by The Credit Union League of Connecticut)
Credit union officials, staff, volunteers and guests participated in education sessions on compliance issues and the corporate system, a chapter officials organizational meeting, and interchange update and discussion, and heard guest speakers. They also visited with more than 40 exhibitors and industry service providers. Featured speakers included Connecticut Attorney General George Jepson, who spoke on the function of his office; Lt. Colonel John T. Wiltse of the Connecticut National Guard, who discussed current guard activity; Jay Friedland, compliance expert, president/CEO of M&M Consulting, and a league strategic partner, who reviewed current hot compliance issues; and Jay Murray, president of Mid-Atlantic Corporate CU, who provided an overview of the corporate credit union system. During the business meeting, the board of director’s governance committee presented results of the recent statewide affiliated credit union voting approving realignment of the league’s board from 12 directors and six alternates to six chapter directors and three at-large directors to streamline and enhance board effectiveness. Also, the 2011 Connecticut Credit Union Professional of the Year Award was presented to Robert L. Aresti, president/CEO of 360 FCU, Windsor Locks, in recognition of his contributions to his credit union, its membership, the community it serves, and the credit union movement in Connecticut as a whole.

CU System brief (04/07/2011)

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* WASHINGTON (4/8/11)--The 2011 Credit Union House Board recently elected officers at its annual meeting, held in conjunction with the Credit Union National Association's Governmental Affairs Conference (Highlights from the Hill first quarter). They are, from left: Vice Chair Dick Ensweiler, president of the Texas Credit Union League; Director Bill Mellin, president of the Credit Union Association of New York; Treasurer Brett Thompson, president of the Wisconsin Credit Union League; Chairman Charles Elliott, president of the Mississippi Credit Union Association; Secretary Patrick La Pine, president of the League of Southeastern Credit Unions; and President Bill Cheney, president/CEO of the Credit Union National Association. (Photo provided by CUNA) …

National CU Youth Week gets its own song

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MADISON, Wis. (4/8/11)--A new song called "Save!"--which encourages thrift and savings among young credit union members--could become a soundtrack for youth week activities for the National Credit Union Youth Week, which is observed April 17-23.
"Save!," a new song by Madison, Wis., thrift rock band, The Disclosures, encourages thrift and savings among young members. From left are band members Christopher Morris, director of communications at the National Credit Union Foundation, and Chris Helminak, Web and member development strategist at the Wisconsin Credit Union League. (Photo provided by The Disclosures)
A Madison, Wis.-based credit union music duo--The Disclosures--released the new song in celebration of the week, which is sponsored by the Credit Union National Association. The song and lyrics can be found on The Disclosures' website (use the link) and is free for credit unions to distribute and share with members. 'When we heard that the theme for this year's youth week was 'Money Rocks at My Credit Union,' it seemed like a natural fit for us to do something special," said band member Christopher Morris, whose day job is as director of communications with the National Credit Union Foundation. The message behind "Save!" is intended for a younger audience and takes a different approach from other tracks found on the band's recently released thrift rock album, "(Hey, We're) The Disclosures," which focuses on themes such as credit union history and philosophy. "We wanted to have some fun with the lyrics, especially the tongue-in-cheek chorus," said Disclosure member Chad Helminak, Web and member development strategist for the Wisconsin Credit Union League. "The fun part about savings isn't putting your money away, but rather envisioning what you're saving for and then reaching your goals." Morris and Helminak were featured in a recent issue of Madison's popular weekly, Isthmus, discussing "thrift rock" and the benefits of credit unions.

CU System briefs (04/06/2011)

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* NAPERVILLE, Ill. (4/7/11)--Nearly 750 executives representing 110 credit unions are expected to attend today's kick-off of the Illinois Credit Union League's 81st Annual Convention, which runs through Saturday in Chicago. This year's 70s' theme is "Get Your Groove On!" Keynote speaker Mike Rayburn, guitarist and stand-up comedian, will present a musical and motivational address, "What if?" The Exhibit Hall will feature more than 80 vendors. The event includes more than 20 educational sessions, including a pre-convention workshop. Saturday's closing session will feature Credit Union National Association (CUNA) President/CEO Bill Cheney, in his first formal visit to Illinois credit unions … * NORWOOD, Mass. (4/7/11)--Stephen Shinnick, a former vice principal at Coakley Middle School, Norwood, Mass., was sentenced to two and a half years in prison for stealing more than $250,000 over a period of years and causing the failure of Norwood School Employee FCU. Shinnick, who was treasurer at the credit union, pleaded guilty to larceny over a period of years. He is to serve six months of the term with the balance suspended for five years, and pay restitution. According to the court documents, he had a gambling problem and used credit union funds to pay more than $164,516 in personal bills, to issue checks payable to himself totaling $130,402 and to pay his children a total of $13,000. The credit union ceased operating in June 2009 and was merged into Rockland (Mass.) CU ( April 5) … * SAN DIEGO (4/7/11)--A San Diego couple was charged with commercial burglary after stealing toys for a holiday toy drive from a Ronald McDonald donation box in the lobby of a branch of North Island CU on Dec. 16. Timoteo Orque, 49, and Rowena Orque, 33, allegedly left the credit union with about $200 in toys and gave them to their children. They were traced through an automobile caught on a surveillance camera and arrested Monday (Los Angeles Times April 5) … * ALBANY, N.Y. (4/7/11)--Sunmark FCU, based in Latham, N.Y., is teaming with All Over Albany to offer grants to microbusinesses and start-ups. The Sunmark Grants program is open to small and new businesses as well as Capital District musicians and artists. They will compete for a $1,500 award and free consulting in the Albany-Colonie Regional Chamber of Commerce's Entrepreneur Boot Camp. Deadline for submissions is April 20. The award recipient will be announced May 16 (The Daily Gazette April 6) … * LANSING, Mich. (4/7/11)--The name of Auto Body CU, a $150 million asset credit union based in Lansing, Mich., has been changed to Astera CU, according to the credit union's website. It changed its name Monday to reflect the variety of select employee groups in its field of membership, said the Lansing State Journal (April 5). Astera serves about 20,000 members with five branches … * SPRINGFIELD, Ill. (4/7/11)--The Illinois Credit Union League (ICUL) has promoted Keith Sias to vice president, state governmental affairs, and Patrick Smith to vice president, communications and regulatory affairs. Both operate from ICUL's Springfield office. Sias joined ICUL in March 1993 and served as a lobbyist representing credit unions before the Illinois General Assembly. He is responsible for analyzing and tracking legislative issues for credit unions, educating them about legislative/regulatory issues, and overseeing state operations of the Credit Union Political Action Council. Before joining ICUL, he was legislative liaison to the Illinois Municipal Retirement Fund, Chicago, and a policy analyst for the Illinois House legislative staff. Smith joined ICUL in October 2004 as director of strategic services. His responsibilities have crossed corporate and department lines of ICUL and ICUL Service Corp. Smith provided consulting services to member credit unions on regulatory, compliance and technical issues, and developed corrective plans to address operational challenges. He previously worked for the Illinois Department of Financial Institutions, Credit Union Division, for 17 years, as an examiner, downstate assistant supervisor and supervisor of the division …

Five cost-effective ways to thwart robberies

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INDIANAPOLIS (4/7/11)--The lingering recession has some individuals looking for new ways to make money, and a few venture down the wrong path, taking desperate measures such as robbing credit unions and banks. To mitigate that activity, shared branching vendor Credit Union Centers has come up with five cost-effective ways to help secure credit union branches from violent crimes. Among the things a credit can do for less than $2,500, says the Indianapolis-based company, are:
* Train staff to look up and verbally acknowledge everyone who walks in the door. The Federal Bureau of Investigation (FBI) lists an alert staff as a top defense against robbery. Robbers will often "case" a facility before the robbery. Staffers are more likely to identify this activity if they are alert to each visitor. If necessary, install a low volume door chime (about $150 installed) that alerts staff when someone enters the building. * Make your lobby design a robber deterrent. Place physical barriers such as check writing stands or queuing lines between the entrance and teller area to prevent a robber from making a straight line from the entrance to the teller and vice versa. By using existing branch components, this can normally be accomplished at no cost, said Credit Union Centers. * Install time delay locks on vault cash storage. Robbers want to get in and out in a hurry. A time delay lock (about $850 installed) requires staff to wait five to 15 minutes after entering the lock combination to access vault cash. Signage posted on the vault door identifies the lack of immediate access to the area. Robbers generally will not wait for the necessary time to expire. Although time delay locks won't prevent a robbery, they reduce the chance of a large loss associated with vault-cash theft. The delay in access requires adjustment by staff and management, but with planning, operations generally do not suffer from the lag time. * Review images on security equipment and make adjustments, if necessary. Adjust security cameras so each teller window is covered by at least one camera--with the head of a member standing at the teller window filling a minimum 15% of the image. Lenses should be focused for sufficient image quality for positive identification of facial features.
"Security cameras and lenses have improved in quality and reduced in price over the last several years," said Dan Davis, executive vice president/chief financial officer of Credit Union Centers. "If your current equipment cannot be adjusted to provide quality images, strategically replacing a few cameras or simply upgrading the lenses on your existing equipment is a very affordable option." Consider installing a pinhole camera (about $650 installed) at eye level within the doorframe of the entry exit door. Robbers will often hide their face from an exposed camera over the teller line, but they are usually looking straight ahead as they exit the branch.
* Make branch security a priority for all staff. Schedule quarterly security meetings for branch staff and review before-, during- and after-robbery procedures. A well-trained staff with fresh information will help when an actual robbery occurs. Networking with the police and other local financial institutions to share procedures and details of robbery activity will help refine internal practices and alert staff of recent local robbery activity.
Davis said that 10 shared branch network branches in Indiana were prone to robbery the past couple of years as the recession intensified. Adding something like a $150 door chime that sounds off each time a member walks into a branch is a cost-effective start, he said. Credit Union Centers trained employees at the affected 10 branches to be alert and notice who's entering the branch--and even say hello. "It's all about paying attention," he said. "If a robber is watching the branch for any amount of time, they won't go near it because of how alert everybody is. They will go somewhere else." As a result of the company's security efforts, robberies at the affected branches the past year were reduced to one. Images from the branch surveillance system and physical descriptions provided by alert staff allowed police to apprehend the robbers quickly. "We realize credit unions and most other organizations during this challenging economic times are on a tight budget, so we implemented some common sense and cost-effective ideas that not only promoted security but fostered great member service as well," Davis said. "Getting to know your members, greeting them at the door, and looking up when they walk into a branch shows members and possible criminals that you're alert."

Cherry Blossom Run success a collaborative effort

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WASHINGTON (4/7/11)--Over the past 10 years, more than 90 credit unions from 30 states have been a part of the annual Credit Union Cherry Blossom Ten Mile Run, indicating its success is a truly collaborative effort in raising funds to benefit Children's Miracle Network Hospitals.
Click to view larger image Officials from Credit Union Miracle Day (CUMD) present their 2011 donation of $578,000 to Children’s Miracle Network Hospitals on behalf of Credit Unions for Kids. The donation brings their 10-year total to more than $5 million. From left are CUMD officials: Jan Roche, State Department FCU, treasurer; Juri Valdov, chairman; Teresa Mann, The Partnership CU, vice chairman; and Sara Turner, Maryland and District of Columbia Credit Union Association, executive director. (Photo provided by Credit Union Miracle Day Inc.)
The 39th annual run Sunday attracted more than 15,000 runners--roughly 7,000 of them credit union members--who competed in the event around the monuments of Washington, D.C. and raised $578,000 to bring the funds donated by credit unions over the 10 years to more than $5 million. More than 700 employees from area credit unions such as State Department FCU, Navy FCU and Northwest FCU volunteered that day. "Thanks to the tremendous support of our lead partner, PSCU Financial Services, once again, we are able to donate 100% of the funds raised to Children's Miracle Network affiliated hospitals across the country," said Juri Valdov, chairman of the title sponsor group, Credit Union Miracle Day Inc. (CUMD). "Thanks to partners such as PSCU Financial Services, the run has been a success on every level." Valdov reported that 91 members of Congress from 34 states were Honorary Race Chairs--more than twice the number as last year. Nearly 700 Hill runners participated in the run. During a kickoff press conference at the Children's National Medical Center in Washington, D.C., Valdov announced that credit unions had signed on to sponsor the race through 2016. CUMD is a partnership of credit unions, credit union service organizations, and partner organizations that have joined under the umbrella Credit Unions for Kids to support Children's Miracle Network Hospitals by sponsoring the run. In addition to PSCU Financial Services, which underwrote the administrative costs of the run, CUNA Mutual Group underwrote the development of CUMD's Facebook pages and helped get credit union support across the country. One hundred percent of the funds raised by credit unions go to their local Children's Miracle Network Hospital. The effort supports 170 hospitals across the country.

AmeriChoice uses grant for youth fin lit outreach

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MECHANICSBURG, Pa. (4/7/11)--AmeriChoice FCU, Mechanicsburg, Pa., is on track to reach more than 10,000 school students this school year, after receiving a grant from the National Credit Union Foundation (NCUF) in 2010 for its financial literacy youth outreach program. The credit union partnered with schools throughout South Central Pennsylvania to teach financial literacy in a three-phase process that takes the credit union message, philosophy, and offerings to the community. The phases include classroom financial literacy presentations, student branch outreach including a new teen club account, and concerts for financial literacy. “AmeriChoice FCU is making a big difference in many young people’s lives thanks to its outreach efforts,” said Christopher Morris, NCUF director of communications. “What’s also impressive is that it is reaching not only students, but school staff, parents, and community partners as well. Serving as a financial resource as well as a financial institution will enable AmeriChoice FCU to truly build relationships for life.”
Click to view larger image AmeriChoice FCU Financial Literacy Manager Kim Dietrich, far left, is shown with students from Cedar Cliff High School Colt’s student branch on their training day at the credit union. The students also toured the credit union and met its senior management team.
Financial literacy has been an ongoing initiative for AmeriChoice FCU for the past six years. It expanded its program to include additional schools, curriculum, and components such as concerts for financial literacy and curriculum integration. The curriculum integration incorporates the four Pennsylvania Career Education and Work Standards: career awareness and preparation, career acquisition, career retention and advancement, and entrepreneurship. All the components are addressed throughout each phase of AmeriChoice FCU’s program. In the classroom financial literacy phase, the credit union's financial literacy manager, Kim Dietrich, works with teachers to integrate financial literacy in area schools' curriculum and teach students. AmeriChoice FCU partnered with the National Endowment for Financial Education (NEFE) to provide financial education materials targeted high schools and college. It has continuously provided NEFE materials to teachers in South Central Pennsylvania. Over the past six years, it has sent 6,500 student workbooks to over 100 teachers at 20 educational facilities. It reached more than 10,000 students through the lessons last year and is on track to do the same for the 2010-2011 school year. Instruction focuses on the credit union difference and philosophy, savings, budgeting, and credit management. In the second phase, reaching youth through student branches and a teen club, students who run the branches come up with innovative marketing techniques to attract fellow students. Among the ideas implemented: video announcements with account incentives, informational tables at school events and activities, and posters to communicate the credit union’s brand message.
Click to view larger image Musicians perform for students at one of AmeriChoice FCU’s concerts for financial literacy. (Photos provided by the National Credit Union Foundation)
Last year, AmeriChoice FCU launched the MyChoice Teen Club Account to help students learn the terminology and options in the financial industry. The club's quarterly newsletter helps 1,200 teens understand the differences between credit unions and banks, how to get and why they need credit, and how to maintain a well-managed checking account with a debit card. New products allow teens to conveniently access their accounts. With home banking and mobile banking, teens are learning how to transfer money and view account balances before overdrawing their account. They also can use resources such as to track their spending habits. Music also plays a role in bringing the financial literacy message to students. AmeriChoice FCU partners with area school districts, music departments, entrepreneurship/business classes and Eloquent Online to perform concerts for financial literacy for students and staff. Performers are selected from the school’s talent show and professional musicians who talk to students about experiences in managing finances and why it is important to be financially literate today. A PowerPoint presentation with financial literacy statistics runs during the concert. Students who work for the credit union branch help promote the concert and participate by throwing out concert t-shirts and signing up new members at the end of the concert. NCUF Innovation Grants are made possible by foundation supporters and the Community Investment Fund, which enables credit unions to earn dividends while donating to national and state community development programs.

Expanded FOM approved for Missouri highway CU

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JEFFERSON CITY, Mo. (4/7/11)--The Missouri Division of Credit Unions approved a community charter to expand the field of membership (FOM) for District 4 Highway Employees CU in Lees Summit, Mo. The credit union is one of 10 credit unions who are losing their locations in Missouri Department of Transportations (MoDOT) facilities. The expanded FOM will allow all those who reside or work in Jackson County, Mo.--whose estimated population is 705,708, according to a 2009 U.S. Census Bureau estimate--to join the credit union (Missouri Division of Credit Unions Electronic Bulletin March 10). It was determined that the credit union is well-capitalized, following the most recent supervisory examination report by the National Credit Union Administration. The $13.2 million-asset credit union was one of 10 credit that the Missouri Highways and Transportation Commission decided to sever ties with, after the commission approved a staff recommendation in March 2010, according to the Missouri Credit Union Association (MCUA) (News Now March 12, 2010). The credit unions were told Jan. 21, 2010, that they would be required to vacate their locations by Sept. 30, 2010. They would no longer be able to process payroll and benefits through MoDOT after that date. Credit union employees were on MoDOT’s salary and benefits plan, but credit unions fully reimbursed MoDOT for those costs, MCUA said at the time. Following pressure from MCUA, state lawmakers and the Missouri Division of Credit Unions, the final proposal offered to the Highway Commission for approval extended the move-out date to Dec. 31, 2012, and included waiving billing for salary and benefits for one quarter--totaling about $325,000 for the credit unions. However, the credit unions were asked to begin paying rent on their space in MoDOT facilities beginning Jan. 1, 2011. The commission ratified MoDOT staff’s recommendation.

Three programs highlight member savings

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MADISON, Wis. (4/7/11)--Credit unions from Hawaii to New York are helping their members change their lives through the power of saving.
Click to view larger image Amazing Savers is a savings challenge developed by Redwood CU, Santa Rosa, Calif. Participating families will compete to win $10,000 by working to improve their financial lives.
In Hawaii, the Kids Savings Project is the brainchild of Dr. Michael Cheang, assistant professor at University of Hawaii-Manoa Department of Family and Consumer Sciences, who was concerned about the need for children to start the savings habit early in life. Cheang secured grants from the Hawaii Community Foundation and partnered with the University of Hawaii FCU to begin the pilot project in 2008. Today, the project works through nine credit unions in Hawaii and 18 schools to teach mostly low-income kids the power of saving. Since its inception, more than 1,100 students saved over $115,000 through the Kids Savings Project. In the program, children set their own savings goals. Credit unions give each saver a piggy bank and other items to make the saving fun. Credit union staffs visit their partner schools regularly for deposit days--some make the experience fun with banners, recognition, and prizes. The project shows that giving children the tools and resources they need to start a savings habit is life changing and dispels the myth that low-income children cannot save money, said a press release from Cheang and the Hawaii Credit Union League. A second program, from Redwood CU , Santa Rosa, Calif., is a savings challenge designed to transform the lives of entire families. Redwood CU recently selected local families as five contestants for its Amazing Savers contest. The five teams will compete to win $10,000 by transforming their finances in 2011. The contestants are:
* Blue Team: Angela and Tom Campbell from Sebastopol, local business owners working to provide for their teenage sons’ educations, support their live-in mother and save for a stable retirement; * Green Team: Cecilia and Juan Flores and their young son from Santa Rosa, seeking to create a livable budget and save money to create a sound future; * Red Team: Priscilla and Dawid Jaworski from Santa Rosa, a young couple with a toddler seeking ways to save and invest to take care of their growing family; * Purple Team: Jennifer Lynch from Corte Madera, a teacher who struggled with job loss, but is looking for ways to budget wisely and build savings now that she has found full-time employment; and * Orange Team: Sharon Van Patten from Ukiah, a single mother raising three daughters while she worked to earn her degree, and who wants to model good money management for her children.
Each Amazing Savers team will meet regularly with an RCU financial coach who will help them create budgets, reduce debt, and transform their finances so that they can save more and improve their financial future. Followers of the contest can cast their vote online for the team they believe has made the most progress. At the end of the year, the team with the greatest overall improvement to their finances will win $10,000 toward the family’s financial goals. A third example of credit unions helping members save is Ticonderoga (N.Y.) FCU, which is celebrating Youth Savings Month in April by offering any TFCU member under the age of 18 the chance to win one of three $50 U.S. Savings Bonds and $100. Children and parents also can visit credit union branches or the Ticonderoga FCU website to obtain financial education materials. The Credit Union National Association is sponsoring the National Savings Challenge this month and National Credit Union Youth Week, April 17-23. For more information, use the link.

Robins FCU acquires Park Community assets accounts

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WARNER ROBINS, Ga. (4/7/11)--Robins FCU in Warner Robins, Ga., has acquired the Middle Georgia assets and accounts of Park Community FCU, based in Louisville, Ky. The acquisition was effective March 31, according to Robins FCU (Macon Telegraph April 2). The $465 million asset Park Community had two branches in Macon, Ga. One was shut down because Robins FCU has a nearby branch, Megan Allen, Robins FCU marketing assistant, told the newspaper. All employees at the Macon locations of Park Community were either retained or offered jobs at other Robins FCU offices, Allen told the paper. The acquisition gives Robins FCU about 1,800 new members and $15 million in assets, John Rhea, Robins FCU president/CEO, told the paper.

FBI reports 396 CU robberies in 2010

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WASHINGTON (4/7/11)--Robberies occurred at 396 U.S. credit unions last year, according to the Federal Bureau of Investigation (FBI) 2010 Bank Crime Statistics report released Tuesday. Credit unions also experienced 11 burglaries, one act of larceny and zero extortions, the report said. Between Jan.1 and Dec. 31, there were 5,546 robberies, 74 burglaries, eight larcenies, and 13 extortions of financial institutions reported to law enforcement. The total 5,628 reported violations represent a decrease from 2009, during which 6,065 violations of the Federal Bank Robbery and Incidental Crimes Statute were reported. The types of financial institutions offices victimized in 2010 by these crimes were: 1,095 branch offices, 34 main offices, 11 stores, and six remote facilities/other. Other highlights of the report include:
* Of the 5,628 total reported bank robberies, burglaries, and larcenies, loot was taken in 5,102 incidents (91%). Three of the 13 reported bank extortions also succeeded in getting loot. * The total amount taken was valued at more than $43 million--$42.5 million of it in cash. More than $8 million was recovered and returned to the financial institutions. * The most common methods of operation included: demand note (3,142 incidents); oral demand (3,096 incidents); firearm used (1,445 incidents); and use of a weapon threatened (2,461 incidents). In the extortions, perpetrators used or threatened to use explosive devices during five incidents and made threats by telephone in eight incidents. * Acts of violence were committed during 236, or 4%, of the holdups. Seventy-one instances involved the discharge of firearms, 145 involved assaults, one instance involved an explosive device, and 31 instances included hostage situations. No acts of violence occurred during the three reported bank extortions. * Violent acts resulted in 106 injuries, 16 deaths, and 90 persons taken hostage. None of these occurred during the extortions. * Most violations occurred on Friday. Regardless of the day of the week, violations between the hours of 9 a.m. and 11 a.m. were the most common. * The Southern region of the U.S had the highest number of incidents.
The statistics were recorded as of March 16. Not all bank crimes are reported to the FBI. The report is not a complete statistical compilation of all bank crimes that occurred in the U.S. To view the full report, use the link.

Filene seeks CUs to pilot tax refund savings project

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MADISON, Wis. (4/7/11)--The Filene Research Institute has formed a coalition of credit unions to establish savings groups for low-income individuals in their communities. The coalition is planning for 2012 tax time. Because The Saver’s Credit, the Earned Income Tax Credit and the refunds that taxpayers receive are all major contributors to the savings mix, Filene convenes the group to help taxpayers preserve as much of their refund as possible. The project, partially funded by the National Credit Union Foundation (NCUF), seeks to help members save for the future. The project originated as a Filene i3 (Ideas, Innovation, Implementation) initiative called Savings Exchange. The i3 team collaborated with Kim Pate of the Corporation for Enterprise Development (CFED) and included Jackie Edwards, Connexus CU, Wausau, Wis.; Tamela Meade, American Airlines CU, Fort Worth, Texas; Jon Reske, UMass Five College FCU, Hadley, Mass.; and Alison Wolf, FAA CU, Oklahoma City, Okla. Project consultants are John Hoffmire and Craig Wilson from Progress Through Business, a national nonprofit organization that works with underserved communities. Hoffmire also is director of the Center on Business and Poverty, which is part of the Puelicher Center on Banking Education at the Wisconsin School of Business, UW-Madison. Filene recommends the program for credit unions active in the Volunteer Income Tax Assistance program, paid tax services, and with the Investor Education In Your Workplace program, which is sponsored by the Investor Protection Trust and supported by NCUF. Tax time is essential for savers, because the average refund for a family is $1,400, said Filene. This is one of the largest bundles of income that many people receive in a year. Also, for low- and middle-income taxpayers, a saver’s credit of up to $1,000 ($2,000 for couples) is available if they contribute to retirement savings plans. Filene is recruiting more credit unions to participate. For more information, use the link.

American Heritage provides food for Kenyan orphanage

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PHILADELPHIA, Pa. (4/7/11)--Philadelphia-based American Heritage FCU's board of directors has voted to pay for one year's supply of food to feed 67 orphans in Kenya.
Busia orphanage worker Pascalia Wanjala in Kenya shows off the bicycle she received from American Heritage FCU CEO Bruce Foulke and his family. The bike helps her meet the needs of children at the orphanage and helped prompt the donation of a year's supply of food for 67 children by the credit union's board. (Photo provided by the Pennsylvania Credit Union Association) .
The board made the decision after hearing how workers at an orphanage had to go around the community each night to collect food to feed the kids. Bruce Foulke, CEO of the $1 billion asset credit union, had learned that the Busia orphanage in Kenya needed a bicycle to collect food for the children and so workers could get around in the community. His family bought a bicycle through the World Council of Credit Unions (WOCCU), said the Pennsylvania Credit Union Association (PCUA) (Life is a Highway April 6). After receiving the bicycle, Pascalia Wanjala, who works with the orphanage, told WOCCU how much she appreciated it and how it helps her to get around more efficiently. When the credit union's board heard about her daily food collection efforts on behalf of the children, it decided to step in and provide a year's supply of food. Foulke is planning a trip to Kenya in December to work at the orphanage, said PCUA.

IWalletPopI IL.A. TimesI give CUs thumbs up on low fees

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MADISON, Wis. (4/6/11)--Articles featured Sunday in two prominent media outlets--AOL's WalletPop and the Los Angeles Times--gave a thumbs up to credit unions' low checking fees and referred readers to websites to locate a credit union. Personal finance columnist Liz Weston, in her question-and-answer money column in the Los Angeles Times, published a letter from someone who opened a free checking account at a bank--only to see the bank acquired later by another bank. The new bank is charging a $10 monthly service fee. The teller told the reader the huge bank doesn't have to "justify anything we do." Weston's answer: "Goodwill doesn’t count for much when banks are trying to maximize revenue." She noted "checking account fees are making a big comeback lately" because regulators are restricting one of banks' big sources of incomes: bounce fees. As a result, banks are experimenting with other fees. But, the reader has options, said Weston, who advised, "you might want to consider moving your accounts to another bank or a credit union. Credit unions are member-owned financial institutions, and many still offer free checking or have lower fees for low-balance accounts." She referred the reader to a website to locate a credit union. In AOL's WalletPop, an article, "Fed Up With Checking Fees: Try a Small Bank," notes research that indicates 51% of respondents to an online pool would shop for another bank if their bank added a fee for checking accounts. Consumers have alternatives to large banks including credit unions, the article said. "In addition to small banks, we've also sung the praises of credit unions in the past, since they also tend to have lower and fewer fees than large banks," said WalletPop. "To find a credit union near you, check out the website of the Credit Union National Association. While credit unions are membership organizations, in many cases you only need to work, go to school or worship in a particular region to be eligible for membership," the article added. To view the articles, use the links.

Costs to protect member data are increasing

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MOUNTAIN VIEW, Calif. (4/6/11)--For the fifth consecutive year, the cost of data breaches grew, with the average organizational cost of a data breach increasing to $7.2 million--an average cost of $214 per compromised record, compared to $204 in 2009, according to a new study. The 2010 Annual Study: U.S. Cost of a Data Breach, released by Symantec Corp. and the Ponemon Institute in March, also found that for the second year the need for organizations to respond quickly to breaches helped drive the costs associated with the breaches higher. Credit unions have been hit with the costs of data breaches that have occurred at other organizations. Some have even sued the companies breached to recoup the costs of replacing compromised cards. The findings that costs are rising are no surprise, but remain a reminder of the importance of protecting members' data. The study is based on data breach experiences of 51 U.S. companies from 15 industry sectors, including the finance and retail sectors. The breaches ranged from 4,200 to 105,000 compromised records. Among the key findings:
* Rapid response to data breaches costs companies 54% more per record than at companies who respond more slowly. Forty-three percent of companies notified victims within one month of discovering the breach, up seven points from 2009. In 2010, these quick responders had a per-record cost of $268, up 22% from 2009. Companies that were slower to respond paid $174 per record, down 11%. * Malicious or criminal attacks are the most expensive and are on the rise. In this year’s study, 31% of all cases involved a malicious or criminal act, up seven points from 2009. They averaged $318 per record, up 43% from 2009. * Negligence remains the most common threat. The number of breaches due to negligence edged up one point to 41%t and averaged $196 per record, up 27% from 2009. This steady trend reflects the ongoing challenge of ensuring employee and partner compliance with security policies, said Ponemon and Symantec. * Companies are more vigilant about preventing system failures. System failure dropped nine points to 27% in 2010. This trend indicates organizations may be more conscientious in ensuring their systems can prevent and mitigate breaches through new security technologies and compliance with security policies and regulations. * Data breach costs continued to rise. The average organizational cost of a data breach this year increased to $7.2 million, up 7% from $6.8 million in 2009. Total breach costs have grown every year since 2006. Data breaches in 2010 cost companies an average of $214 per compromised record, up $10 (5%) from last year. * Encryption and other technologies are gaining ground as post-breach remedies. However, training and awareness programs remain the most popular, with 63% of respondents using training and awareness programs after data breaches--down four points from 2009. Encryption is the second-most implemented preventive measure as a result of a data breach, with 61%. Both encryption and data loss prevention solutions have increased 17% since 2008.
According to Idrees Rafiq, assistant vice president of Financial and Technology’s IT Consulting, a department of Credit Unions Resources Inc. in Texas, companies experiencing large security breaches face regulatory, reputation and legal risks. “As we saw with breaches in the past--for example, Homeland--not only were there nationwide newspaper articles and genuinely 'bad' press, numerous lawsuits were filed and regulatory authorities had no choice but to get involved in the matter,” Rafiq told the Texas Credit Union League (LoneStar Leaguer (April 5). The overall trend shows that the criticality of data protection continues to rise along with the cost. Updating security policies, software and hardware to protect data from cyber-attacks is crucial as the threat to businesses and consumers increases and becomes more visible, he said. Rafiq warned credit unions to be diligent through prudent security practices, staff education, consistently updating and changing system software and most importantly, monitoring and protection of member data. He also reminded credit unions that National Credit Union Administration, in its Rule 748, provides guidelines for information security and protection of member data. He ecommended retaining an experienced, professional third-party vendor to perform a thorough security risk assessment of the credit union’s information system and a security evaluation. Symantec recommended organizations implement the following best practices, whether or not they have suffered a data breach:
* Assess risks by identifying and classifying confidential information; * Educate employees on information protection policies and procedures, then hold them accountable; * Deploy data loss prevention technologies that enable policy compliance and enforcement. * Proactively encrypt laptops to minimize consequences of a lost device; and * Integrate information protection practices into business processes.

CUES sues Digital University over URL usage

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MADISON, Wis. (4/6/11)--The Credit Union Executives Society (CUES) has filed suit in a U.S. District Court in Madison, Wis., against Digital University Inc. and an individual, Keith Thygerson, over the university's continued use of CUES' trademarked internet addresses (URLs) after the two companies terminated a contract for online training services in March. Madison, Wis.-based CUES provides conferences, seminars, online learning and executive education to credit unions. It markets under the CUES and CUES Online University trademarks, according to its complaint filed in Friday in U.S. District Court for the Western District of Wisconsin. The society contracted La Jolla, Calif.-based Digital University on Oct. 3, 2008, to provide online content for credit union staff and maintain software programs required to deliver CUES' Online University program. CUES retained the ownership of the trademarks and URLS, including,,,, and, the complaint said. When the agreement was terminated March 15, the defendants continued to use the URLs in violation of the agreement and have not transferred the URLs back to CUES, said the complaint. On March 25, Kenneth Thygerson, president of Digital told CUES the university had no control over the and, which were registered "in the name of an individual who has no obligation to sell or transfer them to Digital University," said the document. Digital University is identified as the registrant of three of the URLs. Thygerson's son, Keith Thygerson, is identified as the registrant of the and URLs, and that registration lists the university's corporate address, said the complaint. CUES said Digital's use of the URLs is a "false designation of origin, false description, and false representation that Digital University's services are provided by, sponsored by, authorized by, or affiliated with CUES," and that the actions "are likely to cause confusion or mistake among purchasers" and amount to trading on CUES' goodwill. It alleges Digital University engaged in trademark infringement, unfair competition, cyber squatting, fraudulent representation, and breach of contract. It is seeking a judgment, injunctions to stop the use of the URLs, their immediate transfer back to CUES, and statutory and punitive damages.

CU System briefs (04/05/2011)

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* RANCHO CUCAMONGA, Calif. (4/6/11)--CO-OP Financial Services announced its patronage pool totals $20.2 million for fiscal year 2010. This year's dividend brings its total patronage distribution to shareholders to $212.1 million since it became a cooperative in 1996. Other milestones include: realizing $64 million in surcharge replacement savings last year through its investment in access to ATMs in retail locations such as 7-Eleven and Costco; saving clients $18.4 million by cutting operational costs, cutting prices, providing clients promotional materials and support, and absorbing infrastructure costs to upgrade the company's telecommunications platform for all CO-OP services; processing more than two billion payment transactions via CO-OP Network, third party ATM, PIN/Signature debit and credit card; and making more than 71 million shared-branching transactions. CO-OP Financial Services is also now processing more than 200,000 transactions per month via CO-Op Mobile and CO-OP My Deposit … * TACOMA, Wash. (4/6/11)--A former office manager and teller at Tacoma-based KBR CU was sentenced to 33 months in prison for embezzling $440,000 from the credit union by a U.S. District judge. Edgar Hugh Kelly, 37, who had worked for nearly 13 years for the credit union, also was sentenced to three years of supervised community service time and ordered to pay restitution. The embezzlement was discovered in 2010 after an internal audit found false records hiding a loss of funds from the credit union's accounts with other banks. He pleaded guilty in November to theft from a lending, credit or insurance institution ( (April 5) … * LA SALLE, Ill., (4/6/11)--Angela E. Pena, 50, of Peru, Ill., a former branch manager of American Nickeloid Employees CU in LaSalle, pleaded guilty March 31 to using her position to illegally inflate her home loan. She was charged with one count of financial institution fraud and faces four to 15 years in prison. Pena had been approved for a $86,900 loan, but the document later was altered to $250,000. Pena had no loan approval except for unsecured personal loans up to $5,000. The theft allegedly financed a gambling habit ( March 31) …

Members are keeping their autos longer

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DULUTH, Ga. (4/6/11)--Credit union members in Georgia are holding on to their cars longer, according to a recent survey conducted by the Georgia Credit Union Affiliates, and nationwide consumer lending data indicates that trend may be affecting credit unions. The Georgia survey indicates 77.1% of respondents reported that they are keeping their vehicles longer to avoid the cost of purchasing a new or used vehicle. The survey included responses from more than 4,000 Georgia credit union members and aggregated data from credit unions statewide. New-auto loan balances at credit unions nationwide have been declining since 2007, according to the Credit Union National Association (CUNA). The balances decreased by 16.5% in 2010. That’s a faster rate of decline than the 7.9% reported in 2009. Used-auto loans rose by 3.4% in 2010, a slightly slower rate than the 3.9% increase in 2009. Auto loans--particularly new-auto loans--also account for a lower overall share of loans than in previous years, according to CUNA data. Overall, autos composed about 29% of credit union loan balances in 2010, down slightly from 30%. But new-automobile loans accounted for 11% of overall loans, down from 13% in 2009. By comparison, in 2006 auto loans represented about 35% of credit unions’ overall loan portfolios, with new autos comprising about 18% of that total.

Filene First meeting of innovators lab held

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WASHINGTON (4/6/11)--The Center for Financial Services Innovation (CFSI) held the first meeting Thursday and Friday in Washington, D.C., of its Financial Capability Innovator Development Lab. The development lab initiative will support a small group of innovators through peer learning opportunities to strengthen their capacity, sophistication and efficiency in delivering solutions that promote the financial capability of underserved consumers. The CFSI’s Financial Capability Innovation Fund is providing $1.5 million in grants to five nonprofit-led projects designed to help low-income, underserved consumers better manage their finances. The Filene Research Institute and Grow Brooklyn/Brooklyn (N.Y.) FCU are two of the five recipients of grants from CFSI. “It was a kickoff week in which the funders were introduced to the five grantees in the program,” Denise Gabel, Filene Research Institute chief innovation officer, told News Now. “The development lab experience will be two years long and have a pretty aggressive research component. There should be a good cross-pollination of ideas.” Gabel attended the meeting with Mark Meyer, Filene CEO. Filene Research Institute will test Lift, a Filene i3 idea, to determine if rewarding consistent timely loan payments with interest rate reductions will leader to better payment behavior. Grow Brooklyn/Brooklyn (N.Y.) Cooperative FCU and online personal financial management software firm Piggymojo will use goal visualization, social dynamics and mobile technology to help low-income savers turn impulse buys into impulse saves. CEO Samira Rajan represented $11 million-asset Brooklyn Cooperative FCU at the meeting. On Friday, all five grantees met with invitees, dignitaries and policymakers at the Russell Senate Building in Washington, D.C. “Everyone there shares an interest in the financial capabilities of Americans and in raising up those capabilities,” Gabel said. Two U.S. legislators stopped by--U.S. Sen. Daniel K. Akaka (D-Hawaii), and U.S. Rep. Sheila Jackson Lee (D-Texas), she added. “A key theme was how to look at financial capabilities differently, because financial education alone is not working. This group is trying to do some things differently, to link the education with the consumer decisions, for instance at the time of a purchase. “No action was taken at the meeting,” Gabel said. “We just got the ball rolling, got the infrastructure set to start to the projects. Filene will begin its project next week, and will put out a call for credit unions to collaborate.” The CSFI lab participants will meet at least twice a year, with the next meeting scheduled for June. Also, participants will informally meet to see each other’s projects down the road, Gabel said. Other grantees and their projects are:
* Consumer Credit Counseling Service of Delaware Valley, which will test whether social commitments and text alerts can help consumers reduce debt; * Co-opportunity Inc., which will leverage technology via a new online platform to enhance the effectiveness and scale of its volunteer budget coaching program; and * Mission Asset Fund, which will franchise its Cestas Populares program, a peer loan coupled with product-specific, peer-led education, to help immigrants build credit and manage credit wisely.
CFSI selected the five projects from among 246 applicants totaling more than $67 million in requests. Organizations from 44 states responded to the request for proposals CFSI released in September.

Future Catalyst Corporate completes 35 town hall meetings

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DULUTH, Ga. (4/6/11)--Management from Georgia Corporate FCU and Southwest Bridge Corporate FCU Friday completed its town hall tour to spread word about their proposal to consolidate into a new corporate, called Catalyst Corporate. During March, the two corporates hosted 35 in-person meetings in eight states--Georgia, Texas, Oregon, Washington, Oklahoma, Louisiana, Arkansas and New Mexico--and two webinars. More than 950 individuals from about 470 credit unions attended. "The attendees had thoughtful questions that demonstrated how much consideration had already gone into their decision about capitalization," said Dianne Addington, CEO of Plano, Texas-based Southwest Bridge Corporate. "By and large, the response was very positive--strengthening our confidence that members will support the plan." According to Greg Moore, CEO of Duluth, Ga.-based Georgia Corporate, "we have kept in close contact with our member credit unions about the evolving plans for months, so members already were well-informed. But the Town Hall meetings were invigorating because we were able to talk to our members about the details and share our excitement about the upcoming consolidation." Moore acknowledged that some credit union leaders are understandably apprehensive about what the consolidation and other changes on the horizon will mean. The meetings provided an opportunity to answer questions "and provide reassurance that the consolidation will have a positive impact on the service and support members have come to expect. I believe that many final reservations were eliminated through these discussions," he said, adding, "the more credit unions know about our strategy, the more likely they are to support it." Addington noted that "this does not mark the end of our robust efforts to ensure credit unions have all the information they need to understand the new business model--we will be reaching out to them at chapter meetings, through correspondence and one-on-one as often as possible." The two corporates announced their intention to consolidate late in 2010. The planned consolidation date is Aug. 1.

Mich league updates CU School Branch Handbook

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LANSING, Mich. (4/6/11)--The Michigan Credit Union League (MCUL) has updated its online “Credit Union School Branch Handbook.” The updated handbook is a how-to guide for establishing a student credit union branch. It was compiled by members for MCUL’s Financial Education Council with experience in setting up and running student credit unions. The handbook was created in 2003. In 2010, the online link was accessed more than 17,000 times, according to the Michigan Monitor (March 28). The handbook contains step-by-step details and advice, including chapters on establishing a partnership for education, setting up and marketing school branches and an appendix with forms and documents, said the league. “Michigan is a leader in school-based credit unions,” said David Adams, MCUL CEO. “In-school credit unions help teach youngsters about the importance of saving and how to be a good financial consumer.” Michigan leads the nation as the state with the most student credit union branches, with 370 operated by 58 credit unions, according to the Credit Union National Association. Michigan has four times the number of in-school credit unions as the state with the next highest total, Wisconsin, with 86. The Credit Union National Association offers an online directory of credit unions with in-school or youth center branches, including a guide for creating youth program. For more information, use the link.

Wash. state savings lottery bill passes House

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OLYMPIA, Wash. (4/6/11)--Washington state’s House of Representatives Friday passed a bill for a prized-linked savings program that will allow credit unions and banks to offer savings accounts linked to prize drawings, as is the case in four other states. Because of a minor amendment to the bill in the house, it is being sent back to the Senate, which approved the bill earlier. It then would go on to the governor to be signed into law. “We held up the bill for a couple of days to vet an additional floor amendment designed to clarify an amendment offered--and approved--in committee that requires savers to keep their funds in the account for a year,” Stacy Augustine, senior vice president and general counsel for the Northwest Credit Union Association, told News Now. “[Wash. State Rep.] Gary Alexander’s (R-20) intention was to keep people from gaming the system. Our floor amendment clarified that savers don’t need to keep their funds in the account for a full year to win the smaller, monthly prizes, just the annual grand prize,” she said. The bill was heartily approved in both the House and the Senate, Augustine added. “There were a couple of no votes in both houses from legislators who traditionally express concerns about bills that might expand gambling,” she said. “We’ve met with most of them to allay their concerns since.” The association is not anticipating any real problems in the bill becoming law, Augustine added. “I think there were two real keys to getting the bill passed,” she said. “Making sure legislators don’t perceive it as an expansion of gambling, and making sure the other financial institutions are included so that they don’t feel like credit unions are just creating another program to ‘steal’ their customers. Honestly, I don’t think that other financial institutions will be terribly interested in offering the program, but it was important to include them so that they didn’t feel excluded from it. “Amending any state law that could be perceived as gambling is always a tricky venture, so the association is very pleased that the bill has been approved by both the Senate and the House,” Augustine added. “We’ll now wait for the Senate to concur with the amendments made in the House, and look forward to having Gov. Christine Gregoire’s signature on the bill soon.” The bill has had the full support of the Washington Asset Building Coalition and the Doorways to Dreams Foundation, Augustine said.

Fin lit survey Consumers ready to spend lack finance skills

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WASHINGTON (4/6/11)--Consumers are ready to begin spending again, reversing a trend of the past few years, according to the results of the National Foundation for Credit Counseling’s (NFCC) fifth annual Financial Literacy Survey released this week. But those same consumers admit they don’t trust their judgment when it comes to managing their finances. About 26% of U.S. adults report they are spending more than they did a year ago. At the same time, more than 40% of Americans grade themselves as C, D or F in their knowledge of personal finance, acknowledging that they lack the know-how to make sound financial decisions, said NFCC. “An admitted lack of personal finance skills coupled with increased spending is a recipe for financial disaster,” said Gail Cunningham, spokesperson for the NFCC. “The good news is that just over three in four, 76%, recognize that they could benefit from the advice of a financial professional. Hopefully, this indicates that Americans will take the steps necessary to improve their financial literacy instead of falling back into the financial sins of the past.” Credit card debt continues to plague consumers. Although more than two-thirds of adults pay for most purchases with cash or debit cards, two in five still carry monthly credit card balances. Consumers’ lack of sound judgment in regard to credit was reflected in recent comments made by the Amy Jo Johnson of the Credit Union Association of the Dakotas, Mid-America to The Bismarck Tribune (April 5). Johnson said her association is seeing more consumers go into debt simply because they don’t know any better. Consumers would make better choices if they were taught financial literacy in school, Johnson added. Credit unions nationwide are participating in financial education activities in recognition of April as Financial Literacy Month. The NFCC is offering the following initiatives:
* New online counseling request form. Recognizing the increased demand for counseling via the Internet, the NFCC retooled its online counseling request mechanism. * Debt Free Pledge campaign. During April, the NFCC is collecting pledges from consumers across the nation to become debt free. Consumers can visit the NFCC website to take the pledge, view the materials and find tips on becoming debt free. * Shred Your Debt Day. A recent Equifax study identified cities nationwide whose populations had the highest debt levels relative to their income. Wilmington, N.C. topped the list. In conjunction with Cintas Document Management and Equifax, the NFCC will host a series of monthly Shred Your Debt events in the cities identified as most in need of financial education, launching with the kick-off event at the Consumer Credit Counseling Service in Wilmington on April 30. * Shred Your Debt Contest. Cintas Document Management, Equifax and the NFCC are hosting an essay contest, with the winner receiving $2,000 to pay down their existing debt, a money coaching session with a personal-finance expert, the Equifax Debt Wise product and ongoing credit counseling with an NFCC Member Agency. Contestants submit an essay explaining their financial situation, and why they should win. * USA Today personal finance Q&A. The NFCC is teaming with USA Today to answer reader personal finance questions during the last week of April. Trained and certified credit counselors from NFCC member agencies will assist consumers with their financial concerns. * National Poster Contest winner announcement. Each year the NFCC hosts the Be MoneyWi$e National Financial Literacy Poster Contest to introduce school-aged children to financial literacy and offer them an opportunity to express their concepts through artwork. This year close to 1,800 students from grades three through 12 submitted posters around the theme of “Be a Superhero! Save Money!” The national winner will be announced and honored at the 2011 Jump$tart Coalition Awards Dinner in Washington, D.C. on April 13.
The Credit Union National Association is sponsoring the National Savings Challenge this month and National Credit Union Youth Week, April 17-23. For more information, use the link.

WABC radio interviews CUNAs Hampel on MBLs

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NEW YORK and WASHINGTON (4/5/11)--In an interview on WABC Radio in New York Saturday, Credit Union National Association (CUNA) Chief Economist Bill Hampel provided information about credit unions' role in small business lending, discussed raising credit unions' member business lending (MBL) cap, and warned about the impact of interchange on consumers. The interview was on "The Small Business Authority Hour," hosted by Barry Sloane, CEO/president/chairman of Newtek Business Services, The Small Business Authority, which sponsors the program. Also on the program was co-host Laura Smith, and Michael Minerva of Capital One. Hampel first explained the credit union difference and educated listeners about credit unions, then moved on to the topic of the hour. Fifteen years ago, credit unions had few MBLs--about $2.5 billion, Hampel said. "Now it's a major growth area for credit unions," he said, adding credit unions today loan about $40 billion. Small business loans are "their fastest-growing loans." He noted that regulations and restrictions have meant that "a lot of businesses are looking for new loans." When asked about the regulatory cap on MBLs, Hampel responded: "It is ironic--credit unions didn't have a cap for their first 80 years, not until about 15 years ago. Then, when we get a limit [imposed], the loans start going up." He noted a bill in the Senate proposes to lift the cap to 27.5% of assets from 12.25%, which would "allow credit unions the flexibility to meet the needs of small borrowers. Credit unions are telling us that they have had to slow down (business lending)--not because they don't have the money but because they're bumping into the cap," he said. After the cap is lifted, credit unions can generate $10 billion-$11 billion worth of business loans, he said. "And that's without tax subsidy, without a bailout," said Sloane. "Yes. It's a deficit-free stimulus," Hampel responded. Hampel also explained what would likely happen if the Federal Reserve's proposal to limit interchange fees progresses. Consumers will be charged more for using their cards and "will likely not use the cards." "Financial institutions--banks and credit unions--need profits to stay in business. If that source of revenue goes away, they have to make it up and regulators will force them to make up the revenue," he said, adding "Free checking is an endangered species." Also, "consumers could likely see per-transaction fee on each debit card transaction." To listen to the interview use the link. The Small Business Authority, powered by Newtek is a CUNA Strategic Services provider.

CUs loan delinquency rate drop significant says CUNA economist

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MADISON, Wis. (4/5/11)--Credit union loan delinquency rates finally broke out of their past 12-month range of 1.70%-1.80% in February, falling to 1.68%, according to the Credit Union National Association's (CUNA) Monthly Credit Union Estimates for February, released Friday. "This is down significantly from the 1.83% reported by credit unions in February 2010," said CUNA Senior Economist Steve Rick. "This drop is even more impressive when you factor in that the denominator of the ratio, total loans, fell 0.4% in February and 1.1% over the last year. We expect the downward trend in loan delinquency rates to continue throughout the year with the ratio falling to 1.3% by year end."
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Share certificate balances fell 0.6% in February, while regular shares balances grew 3.5%, he said, adding, "Credit union members continue to prefer the liquidity of regular shares as they wait for the Federal Reserve to raise interest rates and then move funds to share certificates." Credit unions' savings balances totaled $816.6 billion for February, an increase from February 2010's totals of $783.8 billion, according to the monthly estimates. Regular and other savings accounts accounted for 30% of the amount, while certificates made up 26.4%; money market accounts, 22.3%, share drafts, 11.8%, and individual retirement accounts (IRAs) 9.5%. Share drafts led savings growth with an increase of 6.9%, followed by regular shares, which rose 3.5%. Money market accounts decreased 1% while IRAs grew less than 0.1%.
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On the loans side, credit union loans outstanding decreased 0.4% during February, compared with a 0.6% decrease in January 2011. Adjustable-rate-mortgages grew 0.9% and fixed-rate mortgages increased 0.1%. Used-auto loans fell 0.2%, home equity loans decreased 0.4%, and new-auto loans dropped 1.2%. Credit card loans and unsecured personal loans each fell 1.8%. Fixed rate first mortgages were the largest piece of the loans distribution share--27.2%, followed by used-auto loans at 17.9% of total loans, adjustable rate first mortgages at 12.5% of loans, and new-auto loans at 10.9%. Credit unions' 60+-day delinquencies remained at 1.7%, and the loan-to-savings ratio fell to 70%, while the liquidity ratio (the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities) remained at 19%. Capital growth in February did not keep pace with asset growth, pushing down the capital-to-asset ratio to 9.92% from 10.1%, Rick told News Now. Credit unions' total dollar amount of capital is $94 billion, according to the monthly estimates.

Federation lines up speakers for Mid-Atlantic conference

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NEW YORK (4/5/11)--The National Federation of Community Development Credit Unions will hold its second in a series of regional conferences, Mid-Atlantic Regional Conference: Credit Unions and Community Finance: Lessons and Impact, April 27 in Charlottesville, Va. The event, organized in partnership with the University of Virginia’s Darden School of Business and the Virginia Credit Union League, will feature Prof. Gregory Fairchild, executive director of the Tayloe Murphy Center and associate professor of business administration at the Darden School of Business, who will unveil research analyzing the impact of community development financial institutions (CDFIs). In addition to Fairchild, confirmed speakers include:
* Randy Chambers, chief financial officer, Self-Help CU, Durham, N.C., and federation board chairman; * Daniel Merenda, vice president of planning and consultation, Council of Community Services; * Paul Phillips, president/CEO, Freedom First CU, Roanoke, Va.; * K.C. Soares, Ph. D., international management consultant and executive director, Smith Soares Associates; * Pablo DeFilippi, federation director of membership; and * Terry Ratigan, federation senior development consultant.
Participants will learn about resources available from the federal government and regional programs, designing successful strategies to meet the needs of low- and moderate-income (LMI) communities, learn from field experts and listen to community-based organizations serving these markets. The event is designed to help credit unions gain a better understanding of:
* CDFI certification and low-income designation; * Resources to serve the underserved; * Programs to meet the needs of LMI consumers; * Partnerships to expand service to the underserved; and * Tools to develop outreach strategies in LMI markets; and * Reporting requirements and the regulatory environment.

League to INJ BIZI CUs helping economy

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HIGHTSTOWN, N.J. (4/5/11)--New Jersey Credit Union League President Paul Gentile “set the record straight” with an editorial in the April 4 edition of in response to an editorial by New Jersey Bankers President John McWeeney. Gentile responded to McWeeney’s editorial, “Banks, credit unions must compete on level ground,” by noting the structural difference between banks and credit unions. “Credit unions are structured as nonprofit financial cooperatives and have volunteer boards of directors, who come from the membership,” Gentile wrote in his response, “Credit unions are helping the boost economy’s rebound ” and said they have “volunteers elected by their fellow members. There are no stock options. There is no director pay.” Credit unions enjoy their tax exemption because of that cooperative structure, Gentile explained. In turn, the average savings and loan rates at credit unions are better than at their for-profit competitors. “McWeeney failed to note that there are more than 3,000 subchapter S banks in this country that also are tax-exempt,” Gentile added. While New Jersey banks boasted profits of $860 million in 2010, a 5% increase from 2009, they pulled back on their lending, Gentile said. Meanwhile, the “real story” about New Jersey’s credit unions is their positive effect on the economy, he wrote. “Through the third quarter of [2010], credit union mortgage lending in New Jersey was up 9%,” Gentile explained. “Credit union small-business lending was up 16.6% through the third quarter. Credit unions do true small-business lending, with an average loan of approximately $123,000.” Gentile also pointed out a major advantage banks have over credit unions: the ability to raise capital. Banks can raise funds in capital markets, where credit unions can only create capital through retained earnings. This can at times slow credit union growth, but it also serves as a hedge against credit unions getting caught up in risky financial moves such as the subprime mortgage mess that was a critical factor in the financial crisis, he said. Responding to McWeeney’s contention that New Jersey credit unions should not be allowed to take municipal deposits, Gentile wrote: “In this era of high property taxes, how can the bankers argue against allowing credit unions the same opportunity to compete for municipal deposits that can help drive more competition and give municipalities a better return on their money to help lower taxes? This authority is already allowed in half the states in the country.” In closing, Gentile noted that Sen. Mark Udall (D-Colo.) introduced legislation to raise the member business lending cap on credit unions from to 27.5% of assets from 12.25%. Gentile cited the potential economic growth and job creation the measure would spur. The Credit Union National Association has estimated that the MBL cap lift could provide up to $13 billion to small businesses in the first year alone and create over 140,000 new jobs, at no cost to taxpayers. “We don’t begrudge the bankers for their success, but they must recognize that credit unions can play an even more important role in helping our economy,” Gentile wrote.

First CU opens in former USSRs Georgia

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TBILISI, Georgia (4/5/11)--The global credit union movement has come to the country of Georgia. First Credit Union (FCU) was formed last week in Tbilisi, Georgia ( April 4). The main advantage of FCU in Georgia over any other financial institution in the country is that members know where the money they deposit is going--primarily back out to other members in the form of loans, said in the article. The founders are former bankers. They say the credit union will fill a need in the Georgia financial services market, which previously consisted only of banks and micro-finance organizations. Because of the credit union’s cooperative structure, FCU members will have a relatively high interest rate on their deposited money, 17% annually which is 70% to75% higher than the average bank, said the article. Before the end of the year the credit union hopes to offers 12 new products at four branches in Tbilisi, expanding thereafter to other regions of Georgia. Mamuka Machavariani, head of FCU’s supervisory board, described the credit union as a financial institution where members not only control the money they invest, but that money is insured by law.

Top 10 INews NowI stories for March (04/04/2011)

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MADISON, Wis. (4/5/11)--National Credit Union Administration pronouncements and interchange stories dominated the News Now monthly top 10 stories list for March. The stories are: 10. Hackers steal $527,000 from LES FCU account at bank BATON ROUGE, La. (3/8/11)--Computer hackers from the Ukraine made unauthorized transfers totaling nearly $527,000 from LES FCU, Baton Rouge, La., in September 2009 through the credit union's commercial account with Capital One, according to a lawsuit filed in U.S. District Court Thursday. 9. Wall St. right target to recoup corporate losses: CUNA WASHINGTON (3/24/11)--Credit Union National Association (CUNA) General Counsel Eric Richard said the National Credit Union Administration (NCUA) is "looking at the right kind of parties" if the agency, as reported, intends to attempt to reclaim billions in securities-related corporate credit union losses from the biggest Wall Street firms. 8. NCUA: Ponzi scheme helped close St. Paul Croatian CLEVELAND, Ohio (3/14/11)--The National Credit Union Administration (NCUA) has filed an adversarial action in the U.S. Bankruptcy Court in an attempt to preclude a debtor from discharging loans that he allegedly fraudulently obtained from the failed St. Paul Croatian FCU as part of his Chapter 7 bankruptcy filing. 7. Survey: Tellers are key to satisfaction DENVER (3/16/11)--Tellers have a giant effect on how members/customers feel about a credit union or bank, according to a new study, "Customer Experience with Teller Transactions" by Prime Performance, which advises financial institutions on improving the client experience. 6. Ten inducted to CU House Hall of Leaders WASHINGTON (3/4/11)--Ten credit union leaders who have made a significant impact on the credit union movement at the local, state or national level were inducted into the Credit Union House 2011 Hall of Leaders this week. 5. Cheney warns reg burden is growing ‘crisis’ WASHINGTON (3/3/11)--Credit unions, owned by their members, already have strong incentives to treat consumers well, but they face a crushing "crisis of creeping complexity" under a steady accumulation of regulatory requirements, Credit Union National Association (CUNA) President/CEO Bill Cheney testified before a House subcommittee. 4. NCUA bans trio from CU-related work ALEXANDRIA, Va. (3/22/11)--Three former credit union employees have been banned from future work at any federally insured financial institution under prohibition orders issued by the National Credit Union Administration. 3. NAACP: Delay interchange to assess consequences WASHINGTON (3/14/11)--The NAACP, the well-known civil rights organization, wrote to the Speaker of the U.S. House urging that a congressional review be launched before the Federal Reserve Board acts to implement limits on debit card interchange fees. 2. Senate, House bills would delay Fed interchange plan WASHINGTON (3/16/11)--Credit Union National Association President/CEO Bill Cheney said last night that the proposed interchange delays introduced in both the Senate and House Tuesday give credit union members and other consumers "a ray of hope that the debit card programs they have come to appreciate may continue unchanged, at least for the short term." 1. NCUA could tighten rate-risk program rules ALEXANDRIA, Va. (3/18/11)--A proposed rule that would require federally backed credit unions to create written interest rate risk policies and develop an individual interest risk management insurance program was the central topic of Thursday's National Credit Union Administration (NCUA) board meeting.

Pierce named chairman of MCUA board

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ST. LOUIS (4/5/11)--Dennis Pierce, president/CEO of the Community
Dennis Pierce, president/CEO of Community America CU, Kansas City, Mo., was named chairman of the Missouri Credit Union Association on March 28. He is shown with outgoing chairman Stan Moeckli. (Photo provided by the Missouri Credit Union Association)
America CU in Kansas City, Mo., took the oath of office March 28 as chairman of the board of the Missouri Credit Union Association (MCUA) during MCUA's 82nd Annual Advocacy and Business Meeting. The meeting was held March 28-29 in Jefferson City. Pierce was elected to a one-year term. Outgoing chair Stan Moeckli noted that he made the MCUA record books as the first chairman to visit all of the chapters representing MCUA's constituents. Nearly 150 people converged on Jefferson City, Mo., for the two days. MCUA President Mike Beall reported on efforts by the association and the state's credit unions in a number of state and federal issues related to advocacy and compliance. He also reported on MCUA's efforts on products and services such as shared branching, and education, training and charitable giving.

Alabama State GAC meets in Montgomery

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MONTGOMERY, Ala. (4/5/11)--Alabama credit unions met last week in Montgomery for the Alabama State Governmental Affairs Conference (GAC).
Click to view larger image At the Alabama State Governmental Affairs Conference last week were, from left, state Sen. Cam Ward (R-Alabaster); Joe McGee, CEO of Legacy Community CU, Birmingham; Linda Cencula, Alabama Telco CU, Birmingham; and Patrick La Pine, president/CEO of the League of Southeastern Credit Unions. (Photos provided by the League of Southeastern Credit Unions)
Speaking on a variety of state and federal legislative and regulatory topics were: Ryan Donovan, vice president legislative affairs at the Credit Union National Association (CUNA); Herb Yolles, National Credit Union Administration (NCUA) Region III director; Alabama Credit Union Administration (ACUA) Administrator Larry Morgan; and the League of Southeastern Credit Unions' (LSCU) governmental affairs staff. Four state legislators who have supported credit union issues, including public deposits, spent time with the group during a Legislative Outlook. They urged credit unions to visit lawmakers and provide information about legislation. Often they can't make informed decisions without knowledge from the groups the legislation would affect, the lawmakers said. Afterward, 38 lawmakers attended the GAC's Legislative Reception and interacted informally with credit unions. During the visits to the state house, credit unions addressed a variety of topics--including public deposits and interchange fees--with lawmakers. Although the interchange fee is a federal issue now, the merchants have been asking state governors to write their members of Congress. The meetings were especially important with so many new faces in Montgomery, said LSCU.
Click to view larger image Speaking at a regulatory roundtable during the League of Southeastern Credit Unions' Alabama State Governmental Affairs Conference last week in Montgomery, Ala., were, from left, National Credit Union Administration Region III Director Herb Yolles and Alabama Credit Union Administration Administrator Larry Morgan.
During the regulatory roundtable, ACUA's Morgan said he plans this year to meet with all state-chartered credit unions, beginning with the ones he doesn't already know. He encouraged attendees to contact him when they have a problem. Morgan said he's willing to work with credit unions before it's too late or to look at a regulation that might be outdated. NCUA's Yolles praised Alabama's credit unions for performing better than the national average and noted that interest-based risk is an area that could be a concern for credit unions. He urged credit unions to communicate with their examiners and to question anything they don't understand. Credit unions have rights and must feel empowered to exercise them, Yolles told the group. He also addressed the corporate stabilization plan and answered questions on that subject. CUNA's Donovan discussed CUNA's strategy for interchange and member business lending legislation. On interchange, CUNA uses a five-point plan, with the first point centering on making sure the problem is solved. In 2010, bankers spent more than $30 million in lobby efforts, compared with credit unions' $3 million, he said. Donovan urged credit unions to take part in the movement's Action Alert and rally their members because that's one area where bankers can't compete. Will McCarty, LSCU senior vice president of governmental affairs, noted that 300 bills--well below the norm--have been introduced in the 2011 Alabama Legislature session. On the regulatory side, Scott Morris, LSCU director of compliance, advised credit unions to keep up with regulation changes. During the events, Family Security CU, Decatur, received the President's Award for most overall money raised for the political action committee, and the Cheaha Chapter was presented the Leadership PAC fundraising award for raising the most money in a chapter.

HOPE launches grocery program in underserved parish

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NEW ORLEANS, La. (4/4/11)--A New Orleans-based credit union and its affiliated community corporation have launched a program that will expand fresh food access to underserved neighborhoods in Orleans Parish. HOPE (Hope Enterprise Corp. and Hope CU) is launching the New Orleans Fresh Food Retailer Initiative (FFRI), a program that will award $14 million in forgivable and low-interest loans to supermarkets and grocery stores that locate or plan to locate in the parish's underserved areas. The FFRI program will help vendors to open, renovate or expand retail outlets that sell fresh fruits and vegetables where fresh foods are lacking, particularly for low-income residents, said the credit union. "Communities will be able to reap all the economic development benefits that come along with a grocery store: the creation of steady jobs at decent wages and serving as a catalyst for complementary retail stores and services nearby," said Bill Bynum, HOPE CEO. In a post-Katrina survey conducted by Tulane University, nearly 60% of low-income residents surveyed said they must drive at least three miles to reach a supermarket, but only 58% owned a car. Only 30 full-service groceries had reopened in the city, according to a 2010 study by Social Compact. The city will provide $7 million in Disaster-Community Development Block Grant funds, which will be matched 1:1 by HOPE. The Food Trust, a national non-profit organization that has expanded access to fresh foods in Pennsylvania and New York, will be part of the program delivery team.

N.M. Maine leagues launch Gen Y spokester searches

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ALBUQUERQUE, N.M., and PORTLAND, Maine (4/4/11)--Two state credit union associations--the Credit Union Association of New Mexico (CUANM) and the Maine Credit Union League--have launched searches for a Generation Y "spokester" to help credit unions engage Gen Yers ages 18-25 in their states to get on track for a lifetime of financial well-being. Both states are launching the Young & Free program, developed by Currency Marketing of Canada, with credit union professionals participating in filming a video--the first step in the "American Idol" style search for a spokester who will use social media, special events, meet-ups and other "off-script" methods to reach out to Gen Yers and who will "create a buzz," said Sylvia Lyon, CEO of CUANM. Lyon and other credit union professionals recently met in New Mexico to film a video for the state's program, which is sponsored by 17 New Mexico credit unions. (Use the link to view the video.) Credit unions, with the average membership age in the late 40s, had to do something to stay relevant and to gain a new, young base of members," Lyon said. The program starts with a search for a media and social media-savvy young adult who will engage peers in credit unions, which will work to understand and serve Gen Yers in age-appropriate ways such as free checking accounts, online and mobile services, overdraft forgiveness and other benefits, said Lyon. In Augusta, Maine, credit union CEOs gathered March 24 to film a call for entries video for their Young & Free spokesperson search. On hand to educate the group about the campaign and to film the video and coordinate the "talent," was Currency Marketing. "The fact that so many of [credit union executives] are taking the time to communicate with this generation through this video is a testament to the commitment of Maine credit unions to reaching this demographic," said John Murphy, president of the Maine Credit Union League (Weekly Update April 1). The commercial--and its bloopers reel--will go live April 18 on Both leagues will select three applicants as finalists to be voted on. In New Mexico, the winning spokester will receive an Apple MacBook Pro and high-def video camera, a one year contact, a smart phone and a salary and use of a vehicle for a year. New Mexico's spokester will be announced June 10. Maine's website will be the hub of its search, with applicants submitting video entries. The league also is using Facebook, online and radio advertising, and college campus promotions to spread the word from April 18 to May 16. Voting on the three Maine finalists will begin at the league's Annual Meeting & Convention on May 20 and conclude on June 6, with the winner announced June 13.

CUs continue interchange efforts in media

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MADISON, Wis. (4/4/11)--Credit unions, and ATM fees and the proposed cap on interchange fees continued to draw interest last week from media such as CNBC, Fox 2 News in St. Louis, and the Charleston (W.Va.) Gazette. On "$5 Fees May Be Coming to an ATM Near You" on CNBC (March 31), the Federal Reserve's proposed rule capping interchange fees charged merchants crept into an exchange between Joe Ridout of Consumer Action and Nessa Feddis from the American College of Consumer Financial Services. "Credit unions don't charge fees," said Ridout, because they "don't aim to turn a profit, they have not relied on overdraft fees that gouge consumers and they don't pay their executives eight-figure salaries or multi-million-dollar bonuses, and they don't have to come up with rinky-dink fees to support these irresponsible levels of compensation." Use the link to see the article or the video of the exchange. In St. Louis, Mo., Patrick Adams, president/CEO of St. Louis Community CU, was interviewed by Fox 2 News (March 30). He educated viewers about the differences between debit and credit transactions, and how the proposed changes in interchange income will impact their financial institution. To listen to what he said, use the link. In Charleston, W.Va., Dan Smithson, president of the $150 million asset Star USA FCU, told the Charleston Gazette (March 26) that credit unions want Congress to stop proposed interchange regulations that would prompt small institutions to charge customers up to $60 for using their debit cards. Credit unions would have to charge extra fees to recoup revenue losses, he told the publication. The rules would unfairly penalize credit unions and community banks and it is unrealistic to expect that any merchant would pass savings to consumers, he said. The article also noted that Rep. Shelley Moore Capito (R- W.Va.) had introduced legislation to postpone the final swipe fee rule changes until federal agencies could study how the interchange cap would affect consumers, banks and credit unions, and merchants. Use the link to access the article. The Credit Union National Association opposes the cap on interchange fees and has urged Congress to stop the Fed's work on the interchange proposal and study the possible unintended consequences of the Dodd-Frank Act provision. In addition to Moore Capito's bill in the House, Sen. Jon Tester (D-Mont.) introduced a similar bill that would delay implementation of the proposed rule.

Two W. Va. CUs to merge

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CHARLESTON, W.Va. (4/4/11)--Members of Charleston (W.Va.) Newspapers FCU have voted to merge with Members Choice WV FCU, also in Charleston. Dwindling membership was the driving force behind the merger, said Connie Risner, CEO of Charleston Newspapers FCU, who added that the credit union’s membership has declined to 310 from a one-time level of more than 600 (The Charleston Gazette March 31). The $2.3 million-asset Charleston Newspapers FCU hopes to complete the merger with the $76 million-asset Members Choice WV FCU by the end of June, Risner told the newspaper. Members Choice serves more than 60 select employer groups, and has a community charter, the paper said.

N.H. governor lauds CUs commitment

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PORTSMOUTH, N.H. (4/4/11)--New Hampshire Gov. John Lynch lauded Service CU in Portsmouth, N.H., as a shining example of a community-based business Thursday night at the credit union’s 54th annual meeting. Lynch, who was a keynote speaker at the event attended by more than 300 people, said the credit union’s “unyielding” commitment to its members, employees and community has set the standard against which other companies are measured ( March 25). When disasters strike, Gordon Simmons, CEO of Service CU, is always the first to call in to the governor’s office to offer help, Lynch said. The $1.7 billion asset Service CU is a reflection of all that is good with New Hampshire organizations, Lynch said. Examples of the credit union’s service include $125,000 donations for three years in a row for local flooding victims; $265,000 donated after a tsunami; and support of local groups and organizations such as the Boy Scouts, Simmons told the publication. To read the article, use the link.

Maine league to testify Tues. on state interchange bill

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PORTLAND, Maine (4/4/11)--The Maine Credit Union League will testify Tuesday at a hearing on a state interchange bill. Last week, L.D. 1251--An Act to Prevent Credit Card Company Unfair Trade Practices was printed and introduced in the Maine Legislature, said the league (Weekly Update April 1). The bill was then referred to the Legislature’s Insurance and Financial Services Committee. Sponsored by State Sen. Richard Rosen (R-31), it would prohibit electronic payment systems from imposing certain restrictions on merchants related to the acceptance of credit cards, charge cards, debit cards or other stored-value cards as payment for goods and services. The league said it is “strongly” opposed to the bill because of the impact it would have on both credit unions and consumers. The committee is holding a public hearing on the bill Tuesday, and the league has been preparing testimony for it. Other states with pending or approved interchange legislation, according to the Credit Union National Association’s State Governmental Affairs Update, include:
* Rhode Island’s HB 5467 and SB 319, which will allow merchants to discriminate against certain cards and will give merchants the authority to set pricing; * Vermont’s bill (2010), which contains similar language to the bills in Maine and Rhode Island; * Oklahoma’s HR 1014, which will stop or delay the implementation of Section 1075 of the Wall Street Reform and Consumer Protection Act so statutory changes can be made to ensure institutions with less than $10 billion in assets are exempted without consequences so as not to result in increased fees on consumers at exempted institutions. The bill was recently passed by the Oklahoma House; and * Oregon’s SJM 18, which was introduced in March. It urges Congress to uphold small-business and consumer protections contained in the Durbin Amendment and to reject calls to overturn interchange reforms.
The Credit Union National Association (CUNA) opposes the cap on interchange fees and has told federal lawmakers that such action would harm consumers by driving up costs of debit cards, limiting consumer options, and harming competition and technological innovation. Interchange fees allow business costs, including the risk of consumer nonpayment, to be shared by the payments participants, CUNA said.

CUNA CU savings to stay steady loans to rise

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MADISON, Wis. (4/4/11)--As the economy grows, credit unions' saving balances are expected to stay steady and their loan balances are expected to rise during the next two years, according to Credit Union National Association (CUNA) economists, who met last week to update their outlook for economic conditions and credit union operating results.
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"In short, we now believe that the U.S. economy will grow above trend in 2011 and slow to 3.25% in 2012," said Senior Economist Steve Rick in his summary for CUNA's U.S. Credit Union Profile: Year-End 2010 Summary of Credit Union Operating Results. The profile, as of Thursday, can be accessed on CUNA's site by using the resource link. "Expansionary monetary and fiscal policy along with the natural dynamics of the business cycle will support economic growth in 2011. Economic growth will slow in 2012 as government stimulus programs are withdrawn," said Rick. "At the same time core inflation will remain below the Federal Reserve's implicit target of 2% through 2012" and "labor markets will continue to improve but only slowly." That means the federal funds targeted interest rate "will not begin an upward path until the end of 2011. We expect a 25 basis-point interest rate move at the end of 2011 followed by a two-percentage-point increase in 2012. Thus, the Treasury yield curve should flatten in 2012," he added. He noted that with this backdrop, credit union savings balance growth is expected to remain at 5% for the next two years. "Despite rising disposable incomes, savings balance growth will remain below its five-year average of 6.3%, as members begin to spend again to relieve some pent up demand and deleveraging continues. Currently, members are paying off debt rather than saving any additional surplus funds due to the large interest rate differential between loan and deposit interest rates." CUNA's economists expect credit union loan balances to rise to 4% in 2011 and 6% in 2012. "After falling over 1% in 2010, we expect a rebound in credit union loan balance growth in the next two years as the economy and consumer confidence recovers. Auto loans, credit card loans and purchase mortgage loans will be strong growth areas," Rick said.
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"Credit quality will improve in 2011 and 2012 as job growth picks up. Provisions for loan losses will decline as credit unions shift from building their allowance-for-loan-loss account to maintaining the current level. This will help credit unions' return on assets to recover to 0.60% in 2011 and 0.70% in 2012. Rising net interest margins and cost containment efforts also will boost earnings. "We expect National Credit Union Administration assessments to come in at 20 and 15 basis points of average assets in 2011 and 2012, respectively. We don’t expect a significant drop in interchange income in 2011, but possibly a 10 basis point hit in 2012," he said. The U.S. Credit Union Profile contains detailed full-year 2010 data for credit union operating results and recent data for a variety of economic indicators. Use the resource link to access the report, which includes the current forecast and commentary.

Colorado CUs to media MBL means for small biz

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BOULDER, Colo. (4/4/11)--Colorado's credit unions and the Credit Union Association of Colorado (CUAC) were featured touting small business loans in an article about the bill before Congress to lift the member business lending (MBL) cap in Thursday's Boulder County Business Report. In the article, "Credit unions poised to loan," the association said that raising the lending cap to 27.5% of a credit union's assets from 12.25% would create an estimated 100,000 new jobs across the U.S. The bill was introduced in Congress by Sen. Mark Udall (D-Colo.), who is quoted in the article as saying his bill would "free up capital--without costing taxpayers a dime--so that credit unions can loan to local small businesses that need to make payroll, buy inventory or expand their businesses." Jay Champion, head of business lending and services at Boulder-based Elevations CU, told the publication that the credit union plans to hire two business loan officers in the next 12 months, but if the cap were raised, it probably would hire four employees. Raising the cap also would allow the credit union to make a more substantial impact on the community and businesses, and help credit unions become bigger players in the community, he said, adding the credit union has money to loan. Banks are lobbying against the plan, but raising the cap would free up some money to lend, said CUAC spokesman Tom Dore in the article. Also interviewed were Rick Allen, president/CEO of Boulder Valley CU, and Carlos Pacheco, president of Boulder-based Premier Members FCU, who both said they are looking for ways to lend more money. Some credit unions are close to the MBL cap and may have to stop helping small businesses, even though credit unions can provide a lot of benefit to local small businesses, said Pacheco. The article also cites statistics from the Credit Union National Association (CUNA) about the impact of raising the MBL cap. CUNA recently released updated statistics indicating that raising the cap would create 140,000 new jobs and provide $13 billion in new small-business loans. To access the full article, use the link.