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NEFE 59 of parents financially support adult kids

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DENVER (6/1/11)--Fifty-nine percent of parents are financially supporting adult children when they are no longer in school, reports a survey from a partner well-known to credit unions. The statistic reflects how the current economic and job landscape is presenting a bigger challenge than expected--for those who should be leaving the nest as well as their parents. Commissioned by the National Endowment for Financial Education (NEFE), in cooperation with, the poll was conducted by Harris Interactive in May. NEFE has worked with many credit unions in making classroom financial education presentations the past several years through its High School Financial Planning Program. Credit unions noting the intergenerational living trend can help their members--both the adult children and their parents--by addressing the impact the trend can have on the parents' finances, and by educating them on ways to encourage independence. In the survey, 65% of adult children--ages 18 to 39 who are not in school--believe the financial pressures faced by their generation are tougher than those experienced by previous generations. Parents agree, with 32% of parents indicating their own generation had it easier than their children's generation. "This doesn't surprise me. The job market is terrible for people my age. We all got our college degrees but there was no place to go. Even the fast food joints say we're overqualified," said one 29-year old member of University of Wisconsin CU, Madison, Wis., who has lived the past year with his parents. When he was laid off two years ago, he had saved enough money to stay afloat for eight months. He told News Now that he has turned in more than 2,000 resumes since he lost his job. He gets by on sporadic temp work but "hunting for a job is my full-time job." He worries about emergencies even though "I can make a dollar last longer than anyone I know. I have a 12-year-old car; no health insurance; and I absolutely hate depending on my parents." His parents aren't too happy either. They decided to foot the bill for catastrophic health insurance for their son. "He's taking care of his car insurance and his basic bills--the phone bill and his student loan and day to day expenses--and he helps out a lot in other ways, but he can't swing the health insurance, too, on what he makes," said his mother. According to the survey, 43% of parents providing the financial support do so because they are "legitimately concerned" with their child's financial well-being, while 37% said they struggled in the past and do not want their children to struggle the same way. "Parents are continuing their involvement longer than we expected," said Ted Beck, NEFE president/CEO. "The general sentiment is that financial pressures are higher for this generation. But if parents are going to financially support their adult children, they should first have a serious talk about their kids' expectations so that everyone protects their financial futures." He noted it is a mistake for parents to make sacrifices such as taking on extra debt or delaying retirement to help their adult child because they are putting their own financial future in jeopardy. Parents, the survey found, are providing support in these ways:
* 50% are providing housing; * 48% are helping with living expenses; * 41% are aiding with transportation costs; * 35% are providing insurance coverage; * 29% are handing out spending money; and * 28% are helping with medical bills.
Among the children at home, 42% said they contribute in non-financial ways, such as cooking, cleaning or child care, but 75% financially contribute to the household with:
* 52% chipping in toward groceries/other food expenses; * 34% helping with utilities; * 31% putting gas in the family car; and * 29% helping with the rent or mortgage.

Agency has latitude on CU-to-bank conversions

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WASHINGTON (6/1/11)--A Wisconsin budget amendment that aims to make it easier for state-chartered credit unions to convert directly to banks doesn't mean it will be easier for them to receive approval to convert. Federal law treats a conversion from a federally insured credit union to a mutual savings bank differently from direct conversions to stock issuing banks. The National Credit Union Administration (NCUA) would have wider latitude in its decision in the latter situation, said the Credit Union National Association (CUNA). Under Section 205 (b)(2) of the Federal Credit Union Act (FCUA), which governs conversions of federally insured credit unions to mutual savings banks, NCUA's role in the conversion process is generally limited to establishing guidelines for the conversion proposal, for proper notice and for ensuring a fair membership vote on the matter. But credit unions that are converting to something other than a mutual savings bank--such as a stock bank or stock thrift--must get approval from NCUA under Section 205 (c) of the act, which generally allows the NCUA Board to approve or deny a conversion to stock form based on a six-factor weighing analysis, said Michael Edwards, CUNA's senior assistant general counsel. NCUA has established specific regulations under part 708(a) of its rules for federally insured credit union conversions to mutual saving banks and for federally insured credit union mergers with banks, but not for direct conversions from a federally insured credit union to any form of stock institution. Conversions to a stock institution without a merger are therefore generally subject to the six-factor statutory weighing analysis on a case-by-case basis. The six factors that the NCUA Board would typically weigh for a conversion to a stock bank or stock thrift are:
* The history,financial condition and management policies of the credit union; * The adequacy of the credit union's reserves; * The economic advisability of the transaction; * The general character and fitness of the credit union's management; * The convenience and needs of the member to be served by the credit union; and * Whether it is a cooperative association organized for the purpose of promoting thrift among its members and creating a source of credit for provident or productive purposes.
In most situations, the NCUA Board would consider the six factors, and make a decision that was, on balance, the most appropriate under the facts. "The NCUA Board would likely have discretion in its decision so long as it's not acting in an arbitrary and capricious manner in light of the facts and the six weighing facotrs," Edwards told News Now.

CU in Oklahoma offers low-rate storm shelter loans

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OKLAHOMA CITY, Okla. (6/1/11)--An Oklahoma City-based credit union is offering special low-interest loans so Oklahomans can build storm shelters as protection from deadly tornadoes. Oklahoma was one of the states battered in the past few weeks by tornadoes. According to a local TV station, storm shelters are the safest place to be and can sustain the debris impact of a F5 tornado. Ten people in the state were killed recently by tornados. None were in a storm shelter--six were in their vehicles and four were inside their homes (KFOR-TV May 27). Communication FCU is doing its part to make storm shelters--which can cost $3,000 to $6,000--more affordable so Oklahomans can be safer, according to the $803 million asset credit union's website. It is offering loans specifically for the shelters at a 2.99% annual percentage rate for qualified borrowers. The 2.99% rate is not an introductory rate but the rate for the term of the loan, the credit union said.

CU System briefs (05/31/2011)

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* COLUMBIA, Md. (6/1/11)--The annual Maryland and District of
Columbia Credit Union Association's (MDDCCUA)Credit Unions for Kids bowling tournament--held May 17-18 at AMF Bowling Center, Alexandria, Va.--raised $11,787 for local Children's Miracle Network Hospitals. Nineteen credit unions sent 49 teams. Bowlers from Enterprise and Visions Ink. joined in . A 50/50 raffle both nights leveraged the donation. CUNA Mutual Group, MDDCCUA, Morgan Keller Specialty Contracts Group and Visions Ink donated items for the door raffle prize. Among those attending were, from left, Denise Goode of Johns Hopkins Children's Center, Erika Lanceskes of U.S. Postal Service FCU, Clinton Md.; and Patty Jasper-Zellner of Children's National Medical Center. (Photo provided by the Maryland and District of Columbia Credit Union Association) … * BANGOR, Maine (6/1/11)--Thaddeus Justice McDonald, 32, of Augusta, Maine, was charged with Class B robbery of the Penobscot County FCU May 25 in Bangor after using a taxi as the getaway vehicle. Class B indicates a weapon was not used in the incident. Police, told that the robber fled in a taxi, stopped the vehicle on a nearby highway and detained McDonald. the suspect. McDonald also was charged with a probation violation (Bangor Daily News June 1) … * MINNEAPOLIS (6/1/11)--A federal court Friday found a 23-year-old Mankato, Minn., man guilty of driving the getaway car in the robbery of a branch of Affinity Plus FCU, a $1.3 billion-asset, St. Paul-based credit union ( May 28). The robbery took place Dec. 16 on the Minnesota State University campus in Mankato. A jury convicted Anthony Akiti on one count of armed credit union robbery and one count of obstruction of justice for driving the getaway car while co-defendant Chop Nguot Tang allegedly stole $17,078 at gunpoint from the credit union. Akiti and Tang each face a potential maximum sentence of 25 years in prison ... * SIOUX FALLS, S.D. (6/1/11)--Cory Bender, 30, of Huron, S.D., was sentenced to five months in custody and five months of home detention for burglarizing M-O FCU, Huron, in October 2010 (Associated Press May 20). Bender entered the credit union with a key he obtained from his job as a maintenance worker and stole $20,000 from a safe, breaking a window to make the burglary appear to be a forced entry, according to court records ...

CU CEO named to Michigan ORR committee

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LANSING, Mich. (6/1/11)--Patty Campbell, CEO of Christian Financial CU, Roseville, Mich., was one of 13 new members appointed by the state of Michigan’s Office of Regulatory Reinvention (ORR) to its Insurance and Finance Rules Committee. The committee will assist the ORR in identifying duplicative, obsolete, unnecessary or unduly restrictive rules affecting the insurance, banking and finance industries, said the Michigan Credit Union League Michigan Monitor May 31). The committee’s first meeting will be held this month in Lansing. “This process will hopefully assure that proper safety and soundness regulations and practices are in place, but without creating too many regulatory burdens and costs for credit unions,” said David Adams, league CEO. “Eliminating unnecessary regulatory hurdles helps credit unions lend and serve Michigan’s economy.” Michigan credit union rules were last reviewed and revised as part of the Michigan Credit Union Act modernization effort during 2004-2005. “Our goal is to ensure strong consumer protections remain in place while eliminating unnecessary and burdensome regulations,” said Steve Hilfinger, ORR chief regulatory officer and director. “These appointments will help the Office of Regulatory Reinvention identify these types of rules that are preventing business growth and job creation.”

PCUA board member challenges readers tax argument

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HARRISBURG, Pa. (6/1/11)--Pennsylvania Credit Union Association board member Paula A. Nihoff advocated for credit unions’ tax-exempt status in a May 26 Readers Forum letter to The Tribune Democrat. Nihoff, who is president/CEO, HealthCare First CU, Johnstown, Pa., was writing in response to a May 20 letter, “It’s time credit unions paid their ‘fair share.’” In 1937, Congress granted credit unions federal tax-exemption based upon their cooperative structure as financial institutions that are operated by and for their members, Nihoff explained. Credit unions operate as democratically cooperative institutions, serving only their members, on a not-for-profit basis. “Credit unions put people (their members) ahead of profit,” Nihoff wrote. She noted that 92 million credit union members receive benefits from better pricing on services as a result of the tax exemption, saving them $7.5 billion a year. “That savings is especially significant when measured against $1.5 billion in lost federal revenue that the government says is represented by the credit union tax exemption,” Nihoff wrote. To read the full letter, use the link.

Md. D.C. CUs recognized for marketingoutreach

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COLUMBIA, Md. (6/1/11)--The Maryland and District of Columbia Credit Union Association (MDDCCUA) at its 25th annual awards ceremony presented 39 awards to 25 credit unions, in recognition of their marketing and communications and outreach activities. More than 70 credit unions attended the event May 25 in Columbia, Md.
OAS Staff FCU, Washington, D.C., won the late Christine DeWitt Memorial Award for Excellence in Marketing, Best of Show at the 25th Maryland and District of Columbia Credit Union Association Trailblazer and National Awards Ceremony. Attending were (from left), DeWitt’s husband, Charlie; Carlos Calderon, president/CEO of OAS Staff FCU; Dewitt’s daughter, Alexandra DeWitt; and Vicki Johnston, acting CEO of COMSTAR FCU, Frederick, Md. (Photo provided by the Maryland and District of Columbia Credit Union Association)
The highlight of the program is the awarding of the Christine DeWitt Memorial Award for Excellence in Marketing, Best of Show, which went to OAS Staff FCU, Washington, D.C. The credit union was recognized for its marketing campaign “Hot Rate Loans” and a special “Green Initiatives” project that included elements in multiple marketing channels. The MDDCCUA Best of Show award, instituted in 2008, is named in honor of late Christine DeWitt, who was the vice president of operations at COMSTAR FCU, Frederick, Md. Her husband, Charlie, and daughter, Alexandra, presented the award to Carlos Calderon, president/CEO of OAS Staff FCU. The National Credit Union Recognition awards recognize credit unions that demonstrate the credit union people helping people philosophy and include the Dora Maxwell Social Responsibility Community Service Award, the Louise Herring Philosophy in Action Member Service Award and the Desjardins Youth and Adult Financial Education Award. The winners will advance to a national competition sponsored by the Credit Union National Association. The MDDCCUA Trailblazer Awards for Excellence in Marketing and Communications honors staff and volunteers who exhibit creativity in marketing and communicating the benefits of their products, services and activities in 12 categories. For a list of the award winners, use the link.

MCUL elects new directors

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LANSING, Mich. (6/1/11)--One new director and two new alternate directors were elected at the Michigan Credit Union League annual convention May 14 in Grand Rapids. John Buckley moved up to director in District III, replacing Dan Witkowski who decided not to seek re-election. Marc McKeller was elected to fill out Buckley’s term as alternate (Michigan Credit Union League Michigan Monitor May 31). Tom Blake did not seek re-election as the District IV alternate director. Connie Bonnee-Toensing was elected as the new alternate. The 2011-12 directors, with alternates in parentheses, are:
* District I--Rudy Callen (Ted Parsons); * District II-- Dan Baines (Tim Hemenway); * District III--Buckley (McKeller); * District IV--George Isola (Bonnee-Toensing); * District V--Howard J. Spencer (Tim Benecke); * District VI--Donald Yuvan (Karen Church); * District VII--Director Victoria L. McIntosh (Lisa Pionk); * District VIII--Director Lonnie L. Bone (Martin Hansen); * District IX--Director Anthony Carnarvon (Dean Trudeau); and * District X--Director Jim Francis (Mike Newman).

Canadas Central 1 CU reports 18.3M profit

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VANCOUVER, B.C., and TORONTO, Ont. (6/1/11)--Central 1 CU, a corporate credit union and trade association serving individual credit unions in the Canadian provinces of British Columbia and Ontario, reported a profit of $18.3 million in the first quarter of 2011. The profit compares with a $7.5 million profit in the same period last year. The latest figure reflects gains of $12.1 million from disposal of financial instruments and a $2.4 million net gain on mark-to-market valuation of Central 1’s portfolio (Marketwire via May 25). Central 1’s return on equity was 12.6%, compared with 5.3% a year earlier. Assets increased 2.9% year-over-year, hitting $14.1 billion as of March 31, compared with $13.7 billion a year ago. In a related matter, Central 1 announced the resignation and retirement of Rowland Kelly from his position as chief financial officer and chief operating officer, effective Sept. 30. Helen Blackburn, Central 1 senior vice president of strategy, has been appointed chief financial officer to succeed Kelly, effective Oct. 1.

Four inducted into Tennessee CU Hall of Fame

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CHATTANOOGA, Tenn., and NASHVILLE, Tenn. (6/1/11)--The Tennessee Credit Union League (TCUL) and Volunteer Corporate Credit Union (VolCorp) recently inducted four individuals into the Tennessee Credit Union Hall of Fame at the TCUL Annual Convention and Expo in Gatlinburg, Tenn. Jointly sponsored by TCUL and VolCorp, induction into the hall of fame is awarded annually to recognize the commitment, leadership and dedication that individuals from the state have made to the credit union movement. The 2011 inductees into the hall of fame are:
* Sandy Lingerfelt, Clinchfield CU, Erwin; * William “Bill” and Alice Jenkins, Rohm and Haas Employees CU, Knoxville; and * Hardie Phipps, Kennedy VA Employees FCU, Memphis.
Lingerfelt has been active in the credit union movement since she began working with several small credit unions in the 1970s. She joined Clinchfield FCU in 1977 and was promoted from part-time clerk to manager when the credit union was $1.6 million in assets. Assets are now more than $60 million. Lingerfelt has more than 10 years of service on the Credit Union National Association board and more than eight years as a board member of the National Credit Union Foundation. The Jenkinses served together in the credit union industry for more than 50 years. As an employee of Rohm and Haas, Bill started the credit union for employees in 1949. Until his death in September 2009, he reported to the credit union every day it was open--more than 58 years. Alice worked alongside Bill for more than 55 years until 2006. She died in 2008. Together, they grew Rohm and Hass to more than $16 million in assets. The late Phipps, former manager/CEO of Kennedy VA Employees FCU, served the credit union for 37 years, from 1971 through 2008. He was an advocate for small credit unions, and he encouraged other credit union managers and volunteers to be active within the credit union system. Phipps served as the treasurer of the Memphis Chapter of Credit Unions for 21 years. Phipps also served on the Tennessee Credit Union League board of directors from 2000 through 2008.