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CU System Archive

CU System

Fed Survey Half of U.S. banks tightening lending

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FARMERS BRANCH, Texas (6/2/08)--A Federal Reserve survey of senior loan officers released May 5 indicates that roughly 50% of banks nationwide are tightening their lending standards on commercial and industrial loans. This could result in opportunities for smaller lenders such as credit unions. The percentage is up from the 30% of banks that reported tightening in January (LoneStar Leaguer May 28). About 65% of banks--up from about 40% in the January Fed survey--indicated that they had increased spreads of commercial and industrial loan rates over their cost of funds for these items. Large banks were more likely to tighten, according to the survey. The pullback by the large banks could create opportunities for smaller and nontraditional lenders. However, some entrepreneurs are feeling uncertain about other types of funding sources, such as venture capital. More businesses--in excess of 5,000 firms--filed for bankruptcy in April 2008 than in any month since the new bankruptcy laws took effect in 2005, the survey indicated. The increase in filings shows that trouble in the subprime housing market and other financial instruments on Wall Street have affected small businesses. A combination of tighter credit, higher commodity prices, and stagnant sales probably account for the rise in bankruptcies, with builders and other businesses tied to the housing market accounting for many filings, the survey said.

State court Payday loans violate Pennsylvania law

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HARRISBURG, Pa. (6/2/08)--The Pennsylvania Supreme Court Thursday ruled that payday lenders who charged borrowers a $150 monthly fee plus 6% interest violated a state consumer law. The decision upheld a ruling last year by the Commonwealth Court, which asserted that Advance America Cash Advance Centers, a payday lender, charged fees that violated the state’s Consumer Discount Company Act (Associated Press May 30). Advance America charged a $149.95 “participation fee” and 5.98% interest on loans up to $500 (News Now Aug. 2). Jim McCormack, Pennsylvania Credit Union Association (PCUA) president/CEO, commended the banking department for taking action against payday lenders. PCUA offers the Credit Union Better Choice Program, “which is designed to move people away from payday lenders and provide a credit union with low-cost alternatives to short-term loans, while coaching them on financial education,” he added.

CUNA Tech Council looks at impact of global changes on CUs

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MADISON, Wis. (6/2/08)--Credit union professionals can learn how changes in global finance, media, and technology will impact credit union business, during a general session at the 2008 CUNA Technology Council Summit, July 30-Aug. 2 in Williamsburg, Va. During “Our Age of Transformation: What’s Next in Our High-Tech, Global 21st Century World?” Peter Leyden, author and former managing editor of Wired magazine, will discuss the interconnected changes taking place in technology, the economy, the media, and the restructuring of the new global order. He will explain how these developments, as well as demographical changes in the U.S., will force a political shift in the coming decade. Additional conference sessions will explore payment card industry compliance, security protection from social networks, mobile banking, information technology staff optimization, virtualization, and ATM capture and imaging. A panel discussion with seven core processors is scheduled for the conference’s final day. Each processor will cover its short- and long-term product and design plans, architecture, and answer questions from the audience. For more information, use the link.

CU Aid gives 123300 to those affected by Calif. wildfires

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RANCHO CUCAMONGA, Calif. (6/2/08)--About $123,300 in grants have been distributed to help credit union members affected by wildfires that hit Southern California last fall, the California Credit Union League said Friday. CU Aid is a centralized disaster relief fund-raising mechanism activated by the National Credit Union Foundation (NCUF) and the league during the fires. The grants were distributed throughout the San Diego area--which was one of the areas hid hardest by the fires. The grants--ranging from $500 to $10,00--were distributed to members of:
* Financial 21 Community CU, San Diego; * First Future CU, San Diego; * Great American CU, San Diego; * Ketema FCU, El Cajon; * Mission FCU, San Diego; * San Diego County CU; * San Diego Metropolitan CU; and * USE CU, San Diego.
Some of the checks were presented by NCUF Immediate Past Chairman Mary Cunningham, CEO, USA FCU, San Diego. “CU Aid grant recipients are realizing they are part of a larger credit union community,” Cunningham said. “They will be loyal credit union members for life.” Most of the recipients lost their homes, and said they are planning to use the money to rebuild. Most of the available funds raised for wildfires victims have now been distributed; some were recently reallocated--with the support of contributor--to help those impacted by the tornadoes that hit Alabama in February. This allowed the NCUF to make 17 more grants totaling over $87,000 for credit union employees and members who lost their homes. The CU Aid donation form has been restructured to ensure that relief money can be channeled efficiently to any major disaster area that impacts credit unions. Supporters can donate via www.cuaid.coop/california in California or www.cuaid.coop/nevada in Nevada. All donations are directed to the National Credit Union Foundation Disaster Relief Fund, which dedicates every dollar to grants. For donors outside of California and Nevada, use the link.

Counterfeit checks with CUs name circulating

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NEW YORK (6/2/08)--Municipal CU, New York City, has contacted the Federal Deposit Insurance Corp. (FDIC) to report that counterfeit checks bearing the credit union’s name are in circulation. The counterfeit checks display the routing number 044000804, which is assigned to JP Morgan Chase Bank in Columbus, Ohio. Municipal CU official checks are issued by Integrated Payment Systems Inc. through an account at JP Morgan Chase Bank. The counterfeit items are similar to authentic checks--but the counterfeit checks are a solid green color instead of a two-tone green. Authentic checks have a telephone number printed on the back. Counterfeit checks do not. Information regarding the counterfeit checks should be sent to Michael Rosano, senior manager, security and fraud department, Municipal CU.

SECUs Scam Jam targets elder abuse

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RALEIGH, N.C. (6/2/08)--A recent Scam Jam event focusing on protecting senior adults from abuse and identity theft was held May 3 by State Employees’ CU (SECU) in Raleigh. “Senior adults are the primary target for so many of today’s scams, including identity theft,” said Karen Daeke, vice president of SECU’s security administration department. “The credit union is aggressively working to educate our members about the various scams and fraudulent practices so they will be better prepared to recognize and avoid such activity.” The event provided workshops, information booths and shredding services. It was promoted to SECU’s Golden Circle members who are located within a one-hour driving distance of the event. SECU has partnered with the attorney general’s office to host other educational presentations related to senior scams, elder abuse and identity theft. SECU also trains its employees on scams and elder abuse. “Knowledge is key in protecting yourself from savvy fraudsters who are more prevalent than ever before,” Daeke said. “Some of our members have fallen victim to various fraudulent practices and the credit union is committed to helping members get the information they need to protect themselves now and in the future.”

Louisianas CUs holding steady with slow growth

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HARAHAN, La. (6/2/08)--In the wake of sustaining 5.7% loan growth in 2007, Louisiana credit unions are experiencing the sluggish loan growth that economists had forecast, with only 0.4% loan growth for the first quarter of 2008. The figures are provided by the National Credit Union Administration. Credit union members are likely to be more cautious about the kind of debt they assume, according to the Louisiana Credit Union League’s Research and Information Department, as indicated by the following state credit union statistics:
* Unsecured credit card loans decreased by -2.5%; * Other unsecured loans an line of credit decreased by -3.2%; * New car loans decreased by -1.7%; * Used car loans increased by 2.4%; and * First mortgage real estate loans increased by 3.8%.
“We recognize that credit union members are traditionally cautious consumers,” Jennifer Green, league assistant vice president, told News Now. “These Louisiana statistics bear out that fact. Members across the state appear to be prudently planning for what lies ahead, and they continue to trust in the strength of their credit unions to provide the resources they need to manage in tough times.” Total shares and deposits increased 4.7% to $6.03 billion from $5.76 billion. This indicates that credit unions are providing competitive savings rates for their members, but credit unions be careful continue to monitor the cost of funds to make sure that shares are priced to avoid uncontrolled share growth, the league’s research and information department said. Membership also showed slow but steady growth with an increase of 0.9% to 1,126,012 from December 2007 through March 2008, the league said. The number of branches also increased to 426 from 419. And 23 credit unions reported plans to add new branches or expand existing facilities in the next 12 months. There was nearly a 5% increase in average salary and benefits for full-time credit union employees to $45,782 in March 2008 from $43,834 in March 2007.

CUs on the Tube North Carolina CUs hike the hill

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GREENSBORO, N.C. (6/2/08)--Representatives of the Piedmont, Northwest, Foothills and Western Chapters of the North Carolina Credit Union League met with legislators in Raleigh during a Hike the Hill event Wednesday. The visits are a part of the State Capital Connections program, and followed visits made one week earlier with members of the Tarheel, North Piedmont, Northwest and Southeast Chapters and the North Carolina General Assembly (Weekly Update May 30). During the meetings, credit union representatives highlighted a study by Dr. William Jackson, which indicated that credit unions saved their members $529 million in one year. The study was based on 2006 data. The league also conducted a video interview with Rep. Trudi Walend (R-Transylvania) during the hill visit (use the link).

State Capital Connections from Jeff Hardin on Vimeo.

CU System briefs (05/30/2008)

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* TEMPE, Ariz. (6/2/08)--Margaret Hunnicutt has been named CEO of Tempe Schools CU. She has served as interim CEO for the last two months, and currently serves as chief financial officer and senior vice president of Tempe Schools CU. Hunnicutt has been with Tempe Schools CU for seven years, is a certified personal accountant, and has more than 30 years in experience in the financial services industry. Hunnicutt also was a finalist for the Tempe Chamber of Commerce’s Business Woman of the Year award in 2007. She brought the Volunteer Income Tax Assistance program to the credit union in 2004. (Photo provided by Tempe Schools CU)... * INDIANAPOLIS (6/2/08)--FORUM CU, Indianapolis, was named one of
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the best places to work in the state by the Indiana Chamber of Commerce. The program honors top companies in the state, as determined through employer reports and employee surveys. FORUM was the only credit union named to the list and among a select few financial services companies honored, according to the credit union. Pictured (from left) are Jennifer Elkin, Indiana Chamber of Commerce representative; FORUM CU representatives Anne Wiseman, Gary Irvin, Jenny Budreau, Andy Janning, and Indiana chamber representative Mark Lawrence. (Photo provided by FORUM CU) ... * HARRISBURG, Pa. (6/2/08)--The Pennsylvania Credit Union Association and the Michigan Credit Union League are wagering a bet on the outcome of the Stanley Cup Championship (Life is a Highway May 30). The leagues bet on their respective teams, the Pittsburgh Penguins and the Detroit Red Wings. A payoff from a bet for the playoff between the Philadelphia Flyers and the Penguins resulted in a $500 donation to Sewickly Valley Hospital. Paul Fero, CEO, PA Healthcare CU, Sewickley, presented the check ... * HARRISBURG, Pa. (6/2/08)--A member who requested a new credit union branch of American Heritage FCU, Philadelphia, got her wish (Life is a Highway May 30). The credit union, which serves members who work in the Social Security Administration Building, celebrated the grand opening May 21. The branch was requested by Beverly Wilmer, who wanted a new branch when an out-of-state credit union terminated full-time service at the Social Security Administration Building. The branch features an Internet cafe and free coin counting machine. A surcharge-free ATM also is available ...

CUs need to say Hey Were the good guys

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MADISON, Wis. (6/2/08)--Television commentator and retail financial services expert Ron Galloway, director of a controversial documentary about Wal-Mart, believes credit unions are the only financial institutions that consumers can trust. But as National Credit Union Foundation (NCUF) Executive Director Steve Delfin explains in his “Viewpoint” column in the June issue of Credit Union Magazine, credit unions need to tell their story. “I met and heard Galloway speak at the Credit Union Association of Colorado and Wyoming’s Annual Meeting,” Delfin said. “While not optimistic about America’s economy, he now emphatically asks, ‘Why aren’t credit unions telling their story? In case you guys haven’t noticed, banks aren’t particularly keen on credit unions. They’re trying to eat your lunch on Capitol Hill.’” As Galloway tells credit unions with his Georgia vernacular, “Y’all need to get loud! You need to say, ‘Hey! We’re the good guys!’” “He’s right,” Delfin said. “We need to tell our stories about the value of credit unions, about the help we provide, about outreach to emerging underserved populations, and about how credit unions are the only financial institutions that consumers can trust.” NCUF is offering credit unions the opportunity to tell their stories in the Social Impact and Community Outreach Special Supplement in Credit Union Magazine. The supplement will be featured in NCUF’s Annual Report to be published in the October issue of Credit Union Magazine. To reserve a spot in the supplement, credit unions and their supporters can use the resource link or call Delfin at 800-356-9655, ext. 6769. “Credit unions truly are standard bearers of social responsibility in the financial services industry,” Delfin concludes. “Credit unions are where the institutional values and principles of the cooperative business model have so clearly and emphatically resulted in socially responsible, ethical, pro-consumer behavior. Credit unions are consumers’ champions. We’re helping the people who need it most. We need to get louder.”

Arizona payday lending struggle could head to ballot box

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PHOENIX (6/2/08)--Two initiatives aimed at payday lending in Arizona could be headed for the ballot box this fall. Arizonans for Financial Reform, which received $2 million from the payday lending industry, is seeking to scrap a state law provision that would eliminate payday lending in Arizona in 2010 (Arizona Daily Republic May 24). If the initiative is approved, payday lenders would remain in Arizona and charge fewer fees. Borrowers would save $2.65 per $100 borrowed, the newspaper said. Another initiative, which was started by Rep. Marian McClure (D-Ariz.), would eliminate payday lending in Arizona entirely. McClure told the Republic that payday lenders prey on low-income individuals who need short-term loans, and payday lending storefronts tempt borrowers in need. About $150,000 signatures must be collected for each initiative by July 3 for a spot on the Nov. 4 ballot. The Arizona Credit Union System advocates financial education and REAL Solutions, Pat Bodnar, league vice president of public affairs, told News Now. REAL Solutions is a product of the National Credit Union Foundation and seeks to help low-wealth consumers accumulate assets. Some Arizona credit unions provide short-term loans, Bodnar added.

Foreclosures near military four times national average

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IRVINE, Calif. (5/30/08)--Foreclosures in U.S. towns where soldiers live are increasing at a pace four times faster than the national average, according to a survey by RealtyTrac Inc. of Irvine, Calif. Earlier this month, RealtyTrac released its April 2008 U.S. Foreclosure Market Report which indicates that foreclosure filings nationwide--default notices, auction sales notices and bank repossessions--were reported on 243,353 properties, a 4% increase from the previous month and nearly a 65% increase from April 2007. Foreclosure filings near military bases from January to April compared with a year earlier were up as high as 492%, according to the report. Among the leaders:
* Columbia, S.C.: 492% increase; * Woodbridge, Va.: 414%; * Triangle, Va.: 363%; * Oceanside, Calif.: 182%; * Norfolk, Va.: 155%; * Havelock, N.C.: 133%; * Carlsbad, Calif.: 131%; * Barstow, Calif.: 120%; * Columbus, Ga.: 102%; and * Twentynine Palms, Calif. 73%.
However, the trend has not affected some of the defense credit unions in these areas. AllSouth FCU, formerly Ft. Jackson FCU, a 406.4 million asset, Columbia, S.C.-based credit union, is not seeing any rise in foreclosures among its members, Thomas Boswell, AllSouth vice president of mortgage lending, told News Now. “The area we’re in is having some [foreclosure] issues, but our particular credit union is not,” Boswell said. “We’ve been extremely fortunate so far. Delinquencies have increased slightly, but we’ve only had one foreclosure all year in 2008.” Columbia, S, C., home to Fort Jackson, has seen a 492% rise in foreclosures so far this year compared with last year, according to RealtyTrac. Payday lenders often get blamed, but Boswell said it’s hard to pinpoint one specific issue for the rise in foreclosures. Payday lending is more of contributing factor rather than a root cause of the problem, he added. The Norfolk, Va., branch of Chartway FCU, a $1.3 billion asset, Virginia Beach-based credit union, has not seen a spike in foreclosures. “We’ve only had one foreclosure this year--a physician who lost his job,” Ron Burniske, Chartway president/CEO, told News Now. Payday lenders, although prevalent, have not impacted his credit union, Burniske added. “There are a tremendous number of payday lenders in our area that gravitate to military bases--we have three bases in our area,” he said. “We haven’t had any direct exposure to them. People who gravitate to payday lenders are not members of credit unions, because we have better services and prices than payday lenders. Most contacts with payday lenders are non-bank contacts; they’re usually not members of credit unions,” he said. The Center for Responsible Lending’s (CRL) research shows that the payday lending business model is designed to keep borrowers in debt, not to provide one-time assistance during a time of financial need. According to CRL's research, borrowers who receive five or more loans a year account for 90% of the lenders’ business. A CRL report shows that payday lenders cost American families $4.2 billion every year in predatory fees. CRL has not conducted any research that studies causation between payday lending and foreclosure rates, Sharon Reuss, CRL spokesperson, told News Now. “However, payday loans do drain wealth from people,” she said. Norfolk, Va., has seen a 155% rise in foreclosure filings, according to RealtyTrac. The Oceanside, Calif., branch of Pacific Marine CU, a $497.4 million asset, Camp Pendleton, Calif.-based credit union, told News Now it is a very conservative lender and has no foreclosures. Oceanside has experienced 182% rise in foreclosure filings this year compared with a year ago, RealtyTrac said.

Former broker hails CUs for avoiding subprime loans

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HARRISBURG, Pa. (5/30/08)--A former mortgage broker praised credit unions for avoiding the subprime loan game at two Pennsylvania Credit Union Association lending council meetings in the state. The former broker, Paul Grabstanowicz, now a training consultant, was conducting training for the meetings on subprime lending solutions, said PCUA (Life is a Highway May 29). Subprime lending was profit-driven, he told the group. In hailing credit unions, he cited a 2004 letter issued by the National Credit Union Administration (NCUA) that warned credit unions about high risk subprime lending activities and said proper care is required in this area. The subprime fallout presents an huge opportunity for credit unions, he said. He urged credit unions to counsel first-time home buyers and offer subprime borrowers safe, conservative products when refinancing members out of subprime adjustable-rate mortgages (ARMs).

CU System briefs (05/29/2008)

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* LAVAL, Quebec (5/30/08)--Desjardins Group, the largest integrated cooperative financial group in Canada, announced it will be the official partner of the Quebec Soccer Federation for three years. The partnership agreement extends support from caisses (credit unions) to local and regional soccer associations across Quebec. Desjardins is also sponsor for the senior and U14 male and female categories of the Quebec Elite Soccer League. "Just like cooperation, soccer, as any team sport, is a sport where solidarity and mutual aid are key ingredients for success," said Monique F. Leroux, president/CEO of Desjardins Group (CNW Telbec May 21) … * PORTSMOUTH, N.H. (5/30/08)--Northeast CU (NECU) is encouraging people to save at least some of their Economic Stimulus Checks by opening a new savings account. Its new Silver Lining Savings account rewards savers with an annual percentage yield of 4.09% on the first $500. The variable-rate account has no monthly maintenance, minimum balance or withdrawal fees, and offers electronic funding and automatic deposit transfers from other accounts. "We believe it's essential for people to be educated about the necessity of having a savings account they can fall back on in these tough economic times," said Peter Kavalauskas, president/CEO … * MILWAUKEE--(5/30/08)--Empower CU and its board have announced a bonus dividend of roughly $150,000--the first dividend in the credit union's history. "Empower CU is successful because of our borrowers and savers, so we wanted to reward our member-owners," said Jennifer Schilling, president of the $133 million asset credit union. "With gas and food prices going up so dramatically over the past few months, we know these funds will assist our members, no matter what state of life they are in." … * CHANDLER, Ariz. (5/30/08)--For the second consecutive year, First CU and the Volunteer Income Tax Assistance (VITA) program partnered to provide low- to moderate-income individuals and families free tax preparation and filing assistance. The credit union volunteers helped return $157,368 to the pockets of area residents. "They were very grateful for the free help. Called us lifesavers," said Jane Hacker, a VITA volunteer and First CU branch manager. The $510 million asset credit union also offered a free opening deposit to those using the VITA program …

Patelco CU agrees to help stabilize Sterlent CU

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SAN FRANCISCO, Calif. (5/30/08)--Patelco CU has stepped in to help the $100 million asset Sterlent CU, which has experienced credit quality issues the past year from home equity loan defaults. Patelco said the state regulator, the California Department of Financial Institutions, has been aware of Sterlent's problems and had been communicating with Patelco up to its move to assist. The Pleasanton, Calif.-based Sterlent reported a net loss of $5.5 million during the first quarter of 2008. Its credit quality issues stem from a home equity loan program it implemented in 2003. Current management ended the program in late 2006, said a press release from Patelco. "We share common roots, credit unions built by members from the telephone industry, so it isn't surprising we come together to help when problems arise," said Andy Hunter, CEO at the $4.1 billion asset Patelco, California's fourth-largest credit union. "As a much larger and more highly capitalized credit union, Patelco has the depth to provide Sterlent with additional experienced support and resources sorely needed in these turbulent times," Hunter said. "Patelco's role right now is to assist Sterlent's management team in their continued efforts to provide stable member services and stem future losses wherever possible, and that is what we intend to do," Hunter said. "I have every confidence that by working together, Patelco and Sterlent will focus on meeting the members' needs, as always." The announcement came less than a week after Patelco announced it will buy another credit union with home equity loan default problems, the Concord, Calif.-based Cal State 9. Both Cal State 9 and Sterlent suffered setbacks linked to the sinking residential real estate market in the area.

CUs can help car buyers steer clear of predatory auto loans

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WASHINGTON (5/30/08)--Credit union auto lenders are invited to participate in a summit that will share new research featuring lending models that “Help Car Buyers Steer Clear of Predatory Auto Loans.” Both the research and the summit will be presented by three national organizations aligned to help credit unions serve working families with low wealth and modest incomes: the National Credit Union Foundation (NCUF), the Annie E. Casey Foundation, and the Aspen Institute. The “Steer Clear” Auto Lending Summit will take place Tuesday, July 22, from 10 a.m. – 2 p.m. at Credit Union House on Capitol Hill in Washington. The first 40 credit union lenders who RSVP by June 13 will receive a preview of the research report: Credit Unions Help Car Buyers Steer Clear of Predatory Loans. At the summit, participants will discuss ideas on anti-predatory lending models that could best be adapted in credit unions. Participants’ input will help finalize the report, which will be shared with the credit union movement through NCUF’s signature program, REAL Solutions. “Credit unions serve only 5% of the non-prime auto loan market,” noted REAL Solutions National Program Director Lois Kitsch. “This new research will offer proven models that credit unions can use to serve this market in ways that are economically viable.” To RSVP, e-mail lkitsch@ncuf.coop. For more information, use the Resource Link or call 800-356-9655, ext. 6770.

Counterfeit checks drawn on Members Exchange CU

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JACKSON, Miss. (5/30/08)--A series of counterfeit teller checks drawn on a Jackson, Miss.-based credit union is circulating in several states, according to the Mississippi Credit Union Association. The checks are drawn on Member's Exchange CU, a $48 million asset credit union. "Scam letters were mailed, along with a counterfeit check, to 'lucky' individuals throughout the country," said Sonny Green, vice president of the association. The checks are for $4,965 and closely mimic MECU's regular teller checks. The routing number, account number and check sequence are valid. However, the logo, while similar, does not exactly match MECU's logo. The word "CERTIFIED" appears as if it was typed on the check by a typewriter. All the checks are signed by the same person, Daniel L. Molinaro. The address on the check is correct, but no phone number is listed. So far, individuals in Kentucky, Arizona and Ohio have contacted MECU about receiving the checks.

Three join NYCUFs Board of Trustees

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ALBANY, N.Y. (5/30/08)--The New York Credit Union Foundation (NYCUF) has appointed three new individuals to its board of trustees. They are: Jeff Davenport, sales manager, CUNA Mutual Group; Shirley Jenkins, board member, Municipal CU, New York; and Christine Peters, Family First of NY FCU, Rochester, N.Y.
Davenport has been CUNA Mutual Group’s sales manager since 2001. He previously worked as president/CEO at County FCU, Caribou, Maine. He has worked for credit unions for more than 11 years. Peters served as chief financial officer of Family First of NY for eight years before being named CEO in January 2006. She has more than 14 years experience in the credit union industry. Jenkins has been a member of Municipal CU’s board of directors since 1983. She is the first female board president in the history of Municipal CU. Jenkins is currently the legislative chair. Other foundation trustees include:
* Chairperson Nancy Kasprzak-Whitmore, president/CEO, Niagara County FCU, Lockport.; * Vice Chair Bruno Sementilli, president/CEO, Quorum FCU, Purchase; * Secretary/treasurer Brian Clarke, chief financial officer, Bethpage (N.Y.) FCU; * Linda Bourgeois, CEO, UFirst FCU, Plattsburgh; * Arthur Field, president/CEO, First Heritage FCU, Painted Post; * John Gibardi, CEO, Entertainment Industries FCU, New York City.; * Michael Lotz, operations manager, British Airways EFCU, East Elmhurst; * James Mack, business development executive, Sunmark FCU, Latham; * William J. Mellin, president/CEO, New York State Credit Union League; * Vicki O’Neill, president/CEO, ACMG FCU, Solvay; * John Prumo, president/CEO, GPO FCU, New Hartford; * James Stracuzzi, president/CEO, CCSD FCU, Elmira Heights; and * Dirck Van Deusen, senior vice president, corporate relations, Empire Corporate FCU, Spring Valley.

New York GAC shares CU difference with state lawmakers

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LATHAM, N.Y. (5/30/08)--New York credit unions participated in 81 "Hike the Hill" visits in Albany, N.Y. last week to promote progressive credit union legislative issues to lawmakers during the New York State Credit Union League's annual Governmental Affairs Conference. They asked state lawmakers to:
* Advance municipal deposits legislation; * Support a special additional mortgage recording tax exemption for state-chartered credit unions; and * Recognize the need for financial education in high schools.
They
New York credit unions visited state lawmakers during the New York State Credit Union League's annual Governmental Affairs Conference last week. From left: John C. Gibardi, CEO, Entertainment Industries FCU; State Assembly Banks Chair Darryl C. Towns (D-Metropolitan); William J. Mellin, league president/CEO; and Lou Jimenez, CEO, Montauk CU. (Photo provided by the New York State Credit Union League)
presented information packets about credit unions, memorandums of support on favorable credit union issues, Project ZIP Code data, the league's second annual Member Outreach & Reinvestment Endeavor (MORE) Report, which documents efforts by New York state-chartered credit unions to fulfill their social mission; and the "Little Guy" from the Credit Union National Association's campaign. More than 100 elected officials and/or their staff attended the event's legislative reception. Attendees heard keynote addresses by John Parfrey, director of the NEFE High School Financial Planning Program; Bob Bellafiore, senior partner, Eric Mower and Associates, who update the group on state politics; and Steven Greenberg, founder, Greenberg Public Relations. Parfrey acknowledged New York credit unions' support of the NEFE's financial literacy efforts with youth. Bellafiore and Greenberg spoke about the state government and the presidential election.

Newspapers error prompts problems at two Arkansas CUs

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LITTLE ROCK, Ark. (5/30/08)--Two Arkansas credit unions were incorrectly listed in a local newspaper’s bankruptcy column, triggering a lot of headaches for the credit union’s employees, members and board members. On Monday morning, Linda Jeffrey, president, TruService Community FCU in Little Rock, picked up a copy of the local newspaper--and what she saw nearly gave her a heart attack. “I couldn’t believe it,” Jeffrey told News Now. “The Arkansas Democrat-Gazette had listed TruService in the bankruptcy section.” After checking the national bankruptcy site, Jeffrey saw that the error was made by the newspaper. The Democrat also incorrectly listed Crossett (Ark.) Paper Mills Employees FCU in the bankruptcy section. Five minutes after seeing the bankruptcy listing, Jeffrey received a call from a board member, who said he had been receiving calls at his home from worried members. Roughly 50 members called the credit union about the error. “There were people coming into the lobby,” Jeffrey said. “It was pretty crazy.” TruService didn’t lose any deposits over the matter--but Crossett Paper Mills Employees FCU did. The credit union has identified four withdrawals directly related to the erroneous article. A total of $190,000 was withdrawn on Tuesday, and $253,000 was withdrawn Wednesday, Crossett Paper Mill Employees FCU President Ed Gilbert told News Now. About 400 members called the Crossett credit union regarding the error. On Monday alone, the credit union’s staff and board received more than 100 calls, Gilbert said. The credit union is still receiving intermittent calls. The town of Crossett has a population of about 6,000--so word spread fast, Gilbert said. “It’s a very tight community. We’re a little unique in that respect, and we suffered a lot more stress because of that,” he said. Gilbert thanked his staff members, board members, and business owners in the community for their help. The brother of a credit union employee works at a local radio station, and he aired a breaking news story on Monday regarding the erroneous article even though the station had scheduled programming, Gilbert said. He also invited Gilbert in for an early morning interview Tuesday, which was replayed throughout the day. Another area radio station disseminated information to clear up concerns. A local newspaper reporter interviewed Gilbert and published an article about the matter, he said. Local paper mills let their employees know that the credit union was not filing for bankruptcy. The local chamber of commerce also sent out an e-mail, Gilbert said. The Democrat has run two retractions, including one in the business section. The first retraction was “tiny,” Jeffrey said. “Even I missed it.” The Ashley County Ledger reported the correction, even though the newspaper did not erroneously report the bankruptcy. Jeffrey has met with the newspaper’s managing editor about the error. It is not known exactly how the error occurred, but Jeffrey thinks the Democrat should publish a story about the credit union’s long success record. “We recognize that mistakes happen,” she said. “But by one strike of a pen, they tarnished our reputation.” Gilbert also agreed the mistake was “unfortunate,” but noted the impact it had. “Anybody can make a mistake,” he said. “But there was negligence in the editing.” The Arkansas Credit Union League sent its attorney to the newspaper and at the league’s request, it printed the second retraction, said Reta Kahley, league president/CEO. The league also is disseminating information to media about the safety and soundness of credit unions in the state. (See “League: Arkansas CUs strong, well-regulated, fed-insured") The printing error occurred two weeks after the Federal Deposit Insurance Corp. closed a bank in Northwest Arkansas, Kahley said.

League Arkansas CUs strong well-regulated fed. insured

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LITTLE ROCK, Ark. (5/30/08)--Arkansas credit unions are among the strongest in the country, the Arkansas Credit Union League said yesterday. “The nearly 300,000 consumers who are members of Arkansas credit unions enjoy saving their hard-earned money and borrowing for their needs,” said Reta Kahley, president of the Arkansas league. Arkansas has 68 credit unions, with more than $1.7 billion in assets. The ratio of reserves to average assets, or net worth, is about 16%. It’s “well ahead of even the national credit union net worth ratio of just more than 11%,” Kahley said. Credit unions in Arkansas and nationwide are among the most highly regulated financial institutions, she added. All deposits in state credit unions are insured by the National Credit Union Administration, up to $100,000. “Not one penny of insured savings has ever been lost by a member of a federally insured credit union,” Kahley concluded. Kahley made the comments upon learning that a newspaper in the state erroneously reported that two credit unions had filed for Chapter 13 bankruptcy. The newspaper ran a correction earlier this week. (See “Newspaper’s error prompts problems at two Arkansas CUs”)

Collections the CU way topic of best practices report

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MADISON, Wis. (5/30/08)--Experts agree that the best strategies for credit collections focus on the process rather than the numbers. Establishing a strong rapport with members, nurturing trust, communicating with respect, and working toward a payment solution is preferable to being concerned only with numbers. Specific process-focused collections strategies are offered in a new best practices report from the Credit Union National Association (CUNA). As the economy struggles and delinquencies rise, Credit Union Magazine Best Practices: Collections the Credit Union Way describes the strategies of eight credit unions for weathering the economic storm. These credit unions--ranging from $23 million to $3 billion in assets--collectively recovered nearly $2.7 million in charge-offs and average a 25.7% recovery rate. Collectors who treat members with compassion and who help craft real solutions to payment problems are the ones who will be paid first when members’ finances improve, said Craig Sacia, manager of credit services at the $542 million asset Altra FCU in LaCrosse, Wis. “If we’re the ones showing them we’re concerned for their well-being, we’re going to make a friend for life if we turn their situation around,” Sacia said. “We want to be the one creditor they hold on to after the storm passes. And if they think we’re nasty to work with, what are our chances of being the last creditor standing?” Best practices reports on succession planning, serving members of modest means, growing youth membership, business services providers, consumer lending, credit counseling, disaster recovery, risk-based lending, and more also are available. For more information, use the link.

Study Credit crunch opening doors for FIs

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BOSTON, Mass. (5/30/08)--Market volatility and the credit crunch are opening doors for financial institutions in two areas, according to studies presented Thursday at the 2008 TowerGroup Financial Services Business & Technology Conference and Exhibition in Boston. The areas are payments--especially related to the demise of paper checks--and securities and investments. The credit crunch is indirectly helping accelerate the decline of paper checks, noted Theodore Iacobuzio, managing director and practice leader of TowerGroup's payments. "The absolute decline in the use of paper checks is one of the great banking headlines of the current decade, and the current credit crunch is playing a key role in driving financial institutions to try to accelerate this trend toward corporate clients," said Iacobuzio. "With consumers still in trouble on the credit front, credit card issuers are ready to move on getting more B2B (business to business) payments off of checks and onto commercial cards," he said, adding the cards are attractive given typically large dollar purchases and 50% lower loss rates than consumer cards. Card issuers naturally will migrate to less risky instruments that derive income from transactions and fees, rather than interest, he said. "Yet a key question will be how long lower loss rates and higher fee income can last, Iacobuzio added. In the securities and investments arena, the securitization of consumer financial products has forever linked Wall Street and Main Street, eliminating "silos" that once defined the financial services landscape, said Rob Hegarty, managing director of TowerGroup's securities and investments). "The financial system has become completely interdependent, and if there is risk to be taken, there is 'insurance' to be sold in the form of structured products," Hegarty said. This means that market contractions will come faster and sharper, as will subsequent rebounds, he said. Opportunities for financial institutions exist in the increasing role of Sovereign Wealth Funds and the rise of trading volumes. Hegarty said TowerGroup predicted 2007's hike in trading volumes and expects to see transaction spikes become debilitating to some market players in 2008. Those who invest in the "industrial strength" infrastructure needed for the new "norm" of trading volumes will see strong pay-off during the next year, Hegarty said. The conference, themed "Charting Your Course for Success," ends today.

Southeast CUs beef up business continuity plans

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JACKSON, Miss. (5/29/08)--With hurricane season less than two weeks away, executives from smaller credit unions across Mississippi met to beef up their preparation in a business continuity workshop. Mississippi was one of the hard-hit states when Hurricane Katrina hit the Gulf Coast in 2005. The Southeast Corporate's “Build a Plan in a Day” workshop was conducted Ken Schroeder, the corporate’s vice president of business continuity. Working on computers, participants learned how to put more structure around their existing business continuity efforts by completing business continuity templates. “My goal was to teach the credit unions some of the basic concepts of business continuity planning, have them understand the templates as they relate to the situation at their own credit union and leave the seminar with a plan in hand,” said Schroeder. “Of course the credit union will have to evolve the plan based on their mission and organization. The folks that attended left with a host of planning tools in hand and are off to a great start.” The biggest problem smaller credit unions have is depth of staff for both planning and implementation, Schroeder said. Laura Burris, president/CEO of McComb (Miss.) FCU, said, "When I walked in, I knew nothing about how to start the process of writing a business continuity plan." Her credit union doesn't have a business continuity plan, she said. Southeast assisted small credit unions in getting grants to attend the workshop from the National Credit Union Administration (NCUA). More information about grants is on the NCUA website at www.ncua.org. Southeast Corporate said it'll offer a similar workshop in South Florida later in the year.

Maine league presents Maxwell Herring awards

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WESTBROOK, Maine (5/29/08)--Nine Maine credit unions have been presented state-level 2008 Dora Maxwell Awards for Social Responsibility and the Louise Herring Philosophy In Action Awards by the Maine Credit Union League. First and second place winners of the Dora Maxwell Award in their asset size categories are:
* $20 million-50 million assets: First place, Community CU, Lewiston, and second place, Great Falls FCU, Lewiston; * $50 million-100 million: First place, Central Maine FCU, Lewiston; * $100 million-$200 million: First place, Five County CU, Bath, and second place, University CU, Orono; and * $200 million-$500 million: First place, Atlantic Regional FCU, Brunswick.
Louise Herring award winners are:
* Less than $50 million in assets: First place, New Dimensions FCU, Waterville, and second place, Community CU; * $50 million-$250 million: First place, Maine Highlands FCU, Dexter, and second place, Central Maine FCU.
The Maxwell and Herring awards are a national awards program coordinated by the Credit Union National Association. Winners will compete for national awards in the fall. A Maine credit union has received a first or second place award in the national competition in seven out of the past nine years.

Study Bank fees problems drive dissatisfaction

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WESTLAKE VILLAGE, Calif. (5/29/08)--Customers' overall satisfaction with retail banks has declined, largely driven by banks' poor problem resolution, long wait times and additional fees, according to a study released Wednesday. Overall satisfaction with the retail banking experience has decreased considerably since 2007--down 26 index points on a 1,000-point scale to 737 in 2008, said the J.D. Power and Associates 2008 Retail Banking Satisfaction Study. The study did not include credit unions. However, the results show yet another opportunity for credit unions to tout their strengths and the credit union difference. Dissatisfaction with fees is the most commonly reported problem by customers surveyed and the second most-cited reason for switching financial institutions, the study concluded. Also, bank customers are experiencing an increase in the number of problems experienced and problems that go unresolved, an increase in wait times to see tellers or speak to phone representatives, and declines in the ease of accessing branches. These all contribute to the drop in satisfaction, said J.D. Power and Associates. "Many retail banks are experiencing a decline in their brand image, especially in the current economic climate, where many consumers hold banks responsible for the current housing and mortgage crisis," said Rockwell Clancy, executive director of financial services at the research firm. "With customers experiencing more problems, longer wait times and more fees, that negative view is intensified," said Clancy. Those retail banks that do provide higher satisfaction levels have more highly committed customers, which are essential to financial growth, the study found. It noted that increasing the number of customers who are highly committed by 5% can lead to incremental deposit growth of 3% annually. "As banks struggle to meet shareholder demands, the common reaction is to focus on short-term financial gains by increasing fees and reducing staff--leading to longer wait times and poor problem resolution," Clancy said. Taking a page from what sounds like a manual in credit union philosophy, Clancy suggests banks try to "differentiate themselves from competitors by focusing on customer service and convenience." This year, the study also analyzed consumer-generated online conversations about banking issues. Most conversations revolved around consumers' daily banking activities rather than national issues such as subprime lending. This indicates that overall ratings of banks are most often driven by personal experiences, said J.D. Power. Topics consumers discussed the most: increased fees and increased annual percentage rates. The survey was conducted with 19,602 households on six factors: transactions, account statements, account initiation/product offerings, convenience, fees and problem resolution.

Michigan league honors Huston Alvarez

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Michigan Credit Union League President/CEO David Adams, left, joins Robert Huston and his wife, Maggie, at the league’s annual convention. Huston received the Distinguished Service Award with an automatic induction into the Michigan Credit Union League Hall of Fame.
Raul Alvarez, center, received the Michigan Credit Union Foundation 2008 Credit Union Community Volunteer Award at the Michigan Credit Union League’s (MCUL) annual convention. Pictured are Robin Alvarez, Raul Alvarez, and MCUL President/CEO David Adams. (Photos provided by the Michigan Credit Union League)
PLYMOUTH, Mich. (5/29/08)--The Michigan Credit Union League (MCUL) honored former chairman Robert Huston and Raul Alvarez, marketing director at Financial Plus CU, during the 2008 MCUL Annual Convention and Exposition. Huston, retired president/CEO at Co-op Services CU, was presented the league’s highest honor, the Distinguished Service Award. The award includes automatic induction into the Michigan Credit Union Hall of Fame. Huston already is a member of the Hall as of 2002, when he finished his term as a league chief elected official (Michigan Monitor May 26). Alvarez received the Michigan Credit Union Foundation 2008 Credit Union Community Volunteer Award. Huston has been active in the international credit union movement, attending conferences in Poland, Australia, Africa, Canada and the Czech Republic. He has provided assistance and training visitors from Latvia, Lithuania and Poland. He also helped the league enter into an international partnership with Macedonia through the World Council of Credit Unions. Alvarez has served on several boards and committees, and has volunteered for community organizations, including schools, Boy Scouts of America, the United Way and Junior Achievement of Mid-Michigan. The MCUL board unanimously approved the recommendations for Huston and Alvarez April 23. MCUL’s convention was held May 15-17 in Grand Rapids, Mich.

MCUAs communications net bronze Quill Awards

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ST. LOUIS (5/29/08)--The Missouri Credit Union Association (MCUA) received two Bronze Quill Awards for its strategic communication efforts from the International Association of Business Communicators’ St. Louis Chapter. MCUA won the highest achievement--an Award of Excellence--in the Issues Management and Crisis Communication category for its 2007 “Save Missouri Credit Unions!” campaign. Missouri Courier magazine received an Award of Merit (second place) in the Publications category. MCUA public/legislative affairs staff members Amy McLard, vice president of public/ legislative affairs, and Larry Deutsch, director of communications, received the awards at a May 22 ceremony. The competition attracted 94 entries from communications professionals in the St. Louis area.

Corporate network topic of free webinar Friday

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MADISON, Wis. (5/29/08)--A discussion of the current market conditions relating to credit unions and the corporate network will be offered in a free webinar 1-2 p.m. EDT, Friday with the CUNA CFO Council and the center for professional development coordinating the event. The webinar specifically is aimed at corporate credit unions, including a review of the financial, health, safety and soundness of the Corporate Network. It will feature speakers from the Credit Union National Association (CUNA) and the National Credit Union Administration (NCUA). The webinar is open and free to all credit unions. The session will include:
* Bill Hampel, CUNA chief economist, providing an economic overview; * Brad Miller, executive director, The Association of Corporate Credit Unions, discussing an overview of the Corporate Network overview points; * Dave Dickens and Kathy Brick from U.S. Central discussing the performance of U.S. Central; and * Kent Buckham, NCUA director of the office of corporate credit unions, providing an agency perspective on the network.
For more information, use the link.

CU System briefs (05/28/2008)

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* HERNDON, Va. (5/29/08)--Northwest FCU (NWFCU) Foundation has formed an official Fairfax County business partnership with Louise Archer Elementary School in Vienna, Va. At the launch ceremony at the school, the foundation donated $5,000 to the school to fund professional staff development and purchase two additional SmartBoards for classrooms. The credit union will provide staff volunteers to promote financial education, facilitate reading programs, conduct a "Saving for College" seminar for parents, and participate in school programs and special events. From left are: Kristen Robinson, assistant manager of NWFCU's Vienna branch; Gerrianne Burks, NWFCU president/CEO; Michelle Makrigiorgos, principal of the school; Phyllis Pajardo, assistant superintendent for Cluster II; and Linda Rogus, NWFCU Foundation executive director (Photo provided by Northwest FCU Foundation) … * CLEARWATER, Fla. (5/29/08)--Staley CU, a $101 million asset credit union based in Decatur, Ill., has been awarded a trip for two to the Beijing 2008 Olympic Games by Visa, America's Olympic Team Partner. The winner was determined by Visa card portfolio metrix that showed the most overall Visa portfolio success from February through March, said Card Services for Credit Unions, whose member credit unions participated in the campaign. From left are: Bruce McElhinney, head of U.S. and Canada sales, U.S. Sales Visa Inc.; Karen Brown, president/CEO of the credit union; and Robert Hackney, CSCU president. (Photo provided by Card Services for Credit Unions) … * SUITLAND, Md. (5/29/08)--Andrews FCU has launched "Imagine the Possibilities," an advertising campaign that focuses on penetrating the Washington, D.C., market. The campaign debuted on cable television, transit and print outlets with three ads highlighting auto loans, home equity loans and general membership. The $810 million asset credit union acquired the city into its field of membership in 2003. "Our focus is to change many of the false perceptions that have stifled growth among credit unions," said Janine Roberts, vice president of marketing. The 30-second cable ads can be seen on major cable stations including Lifetime, TNT, USA, BET, CNBC, Discovery, Food Network, Fox News, HGTV, The History Channel and TLC. Transit ads will run on 50% of the market with placement in 15 prominent subway stations. The ads encourage the target audience to open an account or apply for a loan online or through the credit union's toll free number …

CU discusses smartphone risks in IWall Street JournalI

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NEW YORK (5/29/08)--What would happen if a credit union member lost a smartphone that was filled with personal and financial information? That’s a question that Miriam Neal, vice president of information systems for South Western FCU, La Habra, Calif., is afraid to answer. Neal was interviewed for a May 28 article in a Wall Street Journal that addressed the risks smartphones can pose to companies or financial institutions. Smartphones allow users to check their e-mails and surf the Internet, among other tasks. Many financial institutions, including credit unions, offer their members mobile banking options--which means that some smartphone users are performing financial transactions on their phones. Some risks include malware, which infects phones through text messages and e-mail. Malware can be used by hackers to eavesdrop, and to look at call histories or text messages. There are about 300 to 500 versions of malicious software circulating, the Journal said. Third-party applications such as downloading games and ringtones also can put a smartphone at risk, the newspaper said. To prevent problems, some companies are limiting the access smartphones have to internal networks to protect important data. Neal told the Journal that her credit union is committed to protecting member data. “We need to protect the privacy of our members,” she said.

Visa adds fraud recovery protection for PIN transactions

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SAN FRANCISCO (5/29/08)--Visa Inc. is expanding its fraud recovery process to include two ATM networks and PIN transactions, the company announced Tuesday. The process will extend to Plus and Interlink ATM network transactions to help credit unions and banks recoup losses from counterfeit fraud. The extension will be effective on Nov. 1. In 2006, Visa launched a streamlined recovery program called Account Data Compromise Recovery (ADCR) to improve efficiencies and reduce the costs of assigning liability and collecting reimbursement for counterfeit fraud losses and operating expenses incurred when magnetic stripe storage was compromised. Under the enhanced ADCR process, compensation to Visa card issuers is automatically calculated and reimbursed based on the counterfeit fraud the credit union or bank reports to Visa. Recently enhanced Plus and Interlink fraud reporting capabilities extends the ADCR process to PIN-based transactions. Currently the process applies only to Visa signature-authenticated transactions. The enhancements will improve financial institutions' back-office efficiencies, which include automating the process, Visa said. Acquirer liability for compromises associated with violations of the Payment Card Industry (PCI) Data Security Standard or PCI PIN security violations will be defined through the ADCR program. The program has a fixed 13-month window of exposure, which allows for improved liability forecasting, Visa said. "Expanding this process to include Plus and Interlink represents a significant improvement over the current recovery process for financial institutions with PIN-based transactions, which may require multiple recovery scenarios for a single compromise event if the event involves Visa-branded or Plus- or Interlink-acquired transactions," said Michael E. Smith, head of Payment System Risk at Visa.

Minnesota tornado damages CUs roof

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HUGO, Minn. (5/29/08)--Tornados that struck Minnesota and Iowa Sunday damaged a Postal CU branch’s roof. The Hugo, Minn., branch of the $480 million asset, Woodbury, Minn.-based credit union, sustained some minor interior water leaks, a CUNA Mutual Group inspector determined. The inspector said that the roof likely will need to be replaced. “We also sustained some minor hail damage to our windows,” Russell Plunkett, Postal CU president/CEO, told News Now. “We came out [of the tornados] in really good fashion. We’re structurally safe and sound.” The Postal CU branch has power, is fully operational and is open for business. The hardest hit towns were Hugo--a suburb of St. Paul with a population of roughly 12,000--and three towns in Iowa: Parkersburg (population 1,900), New Harford (population 650) and Dunkerton (population 800), according to CUNA Mutual.

Subprime crunch boosts ATM sales at CUs banks

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NEW YORK (5/28/08)--ATM manufacturers are finding that, contrary to expectations, the credit crunch stemming from the housing market's woes is boosting ATM sales at credit unions and banks. According to ATM & Debit News (May 22), some analysts had expected ATM sales of less than zero this year in the U.S. They based those expectations on the large financial losses major banks were reporting from the subprime-lending fallout. One analyst had predicted ATM sales in the U.S. would drop 5% this year, compared with flat-to-minimum sales growth of 1% last year and in 2006. Now he says sales for 2008 may be flat or up slightly. So, who's buying? Bank of America Corp., JP Morgan Chase & Co., and Wells Fargo & Co. are driving up sales in the U.S. for envelope-free ATMs, including some that accept bulk-cash and bulk-check deposits. They are using the ATMs to shore up frontline relationships with their customers. ATMs are cheaper than financing other bank operations. Credit unions and small banks are driving up sales of bulk-check deposit, envelope-free ATMs, said the article. It pointed out that BECU (formerly Boeing Employees CU), an $8.124 billion asset credit union based in Tukwila, Wash., and other credit unions have purchased multifunctional kiosks. Regional banks, who are often takeover targets, aren’t buying; they're worried about capital expenditures, said analysts. North Canton, Ohio-based Diebold, a CUNA Strategic Service provider, reported first-quarter revenue for its ATM manufacturing unit as $495.8 million, an 8.1% increase over the $458.9 million in first-quarter 2007. It had installed 7,400 deposit automation ATMs in the U.S. as of April 30, said Diebold President/CEO Thomas W. Swidarksi.

Tornado damages CU former Filene director loses car

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WINDSOR, Colo. (5/28/08)--Denver-based Public Service CU is doing its part to help the community of Windsor, Colo., rebuild after a tornado struck the area Thursday and slightly damaged its branch there.
Public Service CU, Denver, donated $10,000 to the American Red Cross Tuesday to help those affected by a tornado that hit the Windsor, Colo., area Thursday. From left are three American Red Cross workers, David Maus, president/CEO of Public Service CU, and Sunny Lubbick, Public Service CU vice president of community outreach and former Colorado State University football coach. (Photo provided by Public Service CU)
The storm destroyed more than 100 homes, and another 100 are uninhabitable, said Bob Hoel, a Filene Research Institute Fellow and member of the board of directors at the $637 million asset credit union. Hoel told News Now that his car was lost in the storm. “The storm took out my car while I was eating in a restaurant,” he said. The downtown Windsor branch of Public Service suffered minor damage and a power outage. “The branch itself was fine,” Steve Ferrero, Public Service vice president of marketing, told News Now. “The heating and air conditioning unit was blown over." Both Hoel and Ferrero agreed that “the credit union was spared,” and noted that buildings within two blocks had severe damage. Though the tornado didn’t affect the branch, it did affect some of the employees--at least one had damage to her home, Ferrero said. Public Service CU moved aggressively to meet the community’s needs after the storm, Hoel added. The credit union donated $10,000 Tuesday morning to the American Red Cross, and is allowing affected members to defer payment on loans. It also is providing emergency lines of credit with low rates, he said. At a shred event in Fort Collins over the weekend, the credit union also collected $2,000 from additional donations to help storm victims. The money will go to benefit those affected by the storms in northern Colorado, Ferrero said. Windsor, which has a population of about 15,000, responded to the storm quickly, Hoel said. “It’s just incredible how quickly they patched up the town. We’re a part of that community and we’re on the fast track to get the city repaired,” he said. Public Service CU has 5,502 members who live in Windsor, and several more who work in Windsor but live outside of town, Ferrero added. Hoel is the retired executive director of the Filene Research Institute.

Jane Bryant Quinn expresses support for CURIA

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GRAND RAPIDS, Mich. (5/28/08)--Newsweek contributing editor Jane Bryant Quinn expressed her support for the Credit Union Regulatory Improvements Act (CURIA) during a keynote speech at the Michigan Credit Union League's Annual Convention and Exposition. recently. Quinn, ranked by World Almanac as one of the 25 most influential women in America, said she supported CURIA, in particular its provision that would allow credit unions to expand their lending to small business, according to the league (Michigan Monitor May 26).
Jane Bryant Quinn expressed support for the Credit Union Regulatory Improvements Act during the Michigan Credit Union League's Annual Convention and Exposition. (Photo provided by the Michigan Credit Union League)
The convention was held in Grand Rapids May 15-17. Quinn spoke about "Financial Empowerment in Today's Economy." Citing the "extraordinary irresponsible behavior of banks and the financial system" in recent years, Quinn termed credit unions "an island of sanity in a sea of madness." "Your communities need you now more than ever," Quinn told credit unions. The U.S. economy is in a recession, she said, noting a rise in unemployment, a decline in national income and corresponding drops in consumer spending and consumer confidence. "I don't see a lot of rescue coming from Washington, and I don't think we've hit bottom yet," she said. She urged the audience to abandon the notion that a home purchase represents a sure-fire growth investment because it won't generate a huge return. From a long historical perspective, the housing boom of the 1990s was an aberration, she told attendees. During a question and answer period, a member of the audience queried her on her past public support for credit union taxation. "I've changed my mind," she said. "Ten or 12 years ago, I thought the banks had an issue. Looking at the situation today--I was wrong." She offered guidelines for prospering in today's market. Among them: "Measure your risk and live a little below your income," she said.

It Belongs to Me is ICU DayCo-op Week theme

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MADISON, Wis. (5/28/08)--This year’s International Credit Union (ICU) Day and Co-op Week will be themed, “It Belongs to Me.”
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ICU Day is scheduled for Oct. 16. Co-op Week will be Oct. 12-18. This is the first year that Canadian cooperatives have aligned their Co-op Week theme with the international theme used by the World Council of Credit Unions and its members. “It Belongs to Me” was picked by a multi-national committee of U.S. and Canadian credit union officials. To promote worldwide involvement, the committee invited all of its member organizations to submit suggestions for the 2008 theme. Laquita Normore, marketing and communications manager for Eagle River CU, L’Anse au Loup, Newfoundland, submitted the theme. “‘It Belongs to Me’ represents ownership, but also suggests a sense of loyalty and personal pride,” Normore said. “At credit unions, every customer is both a member and owner,” said Dan Mica, president/CEO of the Credit Union National Association. “This year’s theme celebrates the economic democracy and equal ownership of each credit union member regardless of how much money that member may have in savings.” “Credit union principles must be preserved for the sake of these members and the continuing strength of the credit union movement worldwide, a recognition our joint events are designed to celebrate,” said Pete Crear, WOCCU president/CEO. Co-Op Week has been celebrated in Canada since 1958. ICU Day has been celebrated annually on the third Thursday of October since 1948. Co-op Week in Canada became a national event in 1982 with the encouragement of the Cooperative Union of Canada. The events provide an opportunity to honor those who have made contributions to the cooperative movement, to recognize the board and staff members working on behalf of credit unions and cooperatives, and to express appreciation to members of credit unions and cooperatives at home and abroad. Promotional materials and products for ICU Day and Co-op Week will be available online in the coming months. October also is National Cooperative Month. For more information, use the link.

Andy List named chairman of Michigan league

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PLYMOUTH, Mich. (5/28/08)--Andy List, president/CEO, Option 1 CU, Grand Rapids, was elected the 32nd chairman of the Michigan Credit Union League (MCUL) May 17, during the 2008 MCUL Annual Convention and Exposition in Grand Rapids.
Outgoing Michigan Credit Union League Chairman Terry Pierce (left), general manager, Security FCU, Flint, passes the chairman’s gavel to his successor, Andy List, president/CEO, Option 1 CU, Grand Rapids. (Photo provided by the Michigan Credit Union League)
He succeeds Terry Pierce, general manager, Security FCU, Flint. George Isola, manager at Ishpeming (Mich.) Community FCU, succeeds List as MCUL vice chairman. Howard Spencer, chairman, Northland Area FCU, Oscoda, was elected secretary/treasurer (Michigan Monitor May 26). The 2008 business meeting consisted primarily of the chairman’s and president’s reports. MCUL President/CEO David Adams focused on “Issues, Initiatives and Solutions” and the role of the league and its affiliates in successfully serving the needs and interests of its member credit unions.

CU System briefs (05/27/2008)

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* SAN DIEGO (5/28/08)--Credit Union National Association's Home &
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Family Finance (H&FF) Radio show taped a program live at Western Corporate FCU's (WesCorp) 2008 Annual Meeting and Future Forum in San Diego. Guests included, from left: Robert "Camo" Gleisberg, membership education and development officer, Pacific Marine CU; attorney Mari Frank, who specializes in identity theft issues; Donna Bland, senior vice president, The Golden One CU; Diana Dykstra, CEO, San Francisco Fire CU; Joe Shroeder, CEO, San Diego Metropolitan CU; Yvette Urea Moe, San Diego County Office of Emergency Services; and H&FF Radio host Paul Berry. Topics discussed: creating a savings strategy in today's economy, coping in today's mortgage market, protection yourself against ID theft, and emergency preparedness for your home and family. The program is scheduled to air Sunday at 3 p.m. EDT on the Radio America network. A podcast can be downloaded afterward from www.radioamerica.org or www.cuna.org. WesCorp is one of the show's national sponsors. (Photo provided by WesCorp) … * BANGOR, Maine(5/28/08)--Kristie Libby, left, of Penobscot County FCU helps a student at the Housing Booth at the Bangor Chapter of Credit Unions' Fourth Annual Financial Fitness Money Management Experience, which involved more than 100 area high school students from five high schools. Credit unions in eastern Maine presented the event on May 22 at Eastern Maine Community College in Bangor. The half-day event features an interactive "game of life," where students map our their financial future at age 22 and create a budget. (Photo provided by the Maine Credit Union League) … * ALBUQUERQUE, N.M. (5/28/08)--John Thompson, former CEO of U.S. New Mexico FCU, died earlier this month in Canton, Ohio, according to the Credit Union Association of New Mexico (CUANM). He was a former president of the New Mexico Credit Union League board and was active in the national and local credit union movements. Thompson is a former board member of the Credit Union National Association, the National Association of Federal Credit Union and Southwest Corporate. He was hired to lead the credit union when it was U.S. Employees FCU in 1979 and led the credit union for 20 years. Thompson received the Ron Moore Hall of Fame Award from CUANM in 2006. He requested no services be held … * HUNT VALLEY, Md.(5/28/08)--Kenneth Jones, former board chairman of Point Breeze CU (PBCU), Hunt Valley, Md., died April 23, the Maryland and District of Columbia Credit Union Association has learned (Focus Newsletter May 27). Jones also served as vice chairman of the credit union. He was a member of the Maryland Credit Union League's legislative committee and was appointed by the governor in 1971 to serve as an original member and director emeritus of Credit Union Insurance Corp. (CUIC). Upon his retirement as PBCU board chairman in 2003, he was named as director emeritus of the credit union … * NORTHVILLE TOWNSHIP, Mich. (5/28/08)--John Mann, retired CEO/president of MPG Community CU, Romeo, Mich., died May 10 at the age of 75. He was former chairperson of the Blue Water Chapter of Credit Unions, according to the Michigan Credit Union League (Michigan Monitor May 26). He was CEO of MPG Community CU from 1981 to 2006 and was first elected chapter chairman in 1991. He is survived by his wife, a daughter, two sons, eight grandchildren and one great-granddaughter …

Southwest Corporate paper makes a case for mortgages

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FARMERS BRANCH, Texas, and DALLAS (5/28/08)--A new white paper released by Southwest Corporate Investment Services, “Making a Case for Mortgages,” suggests that mortgage lending still offers credit unions opportunity. The paper examines the benefits of mortgage lending for credit unions and combats the notion that retaining mortgage originations is too risky, the Texas Credit Union League said (LoneStar Leaguer May 27). Author Joe Arnold also discusses the outlook for mortgage originations this year. Credit quality of credit union mortgage loans is high, interest rate risk is manageable, and current spreads make mortgage lending a valuable opportunity for credit unions, he said.

Filene offering free innovation webinars

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MADISON, Wis. (5/28/08)--The Filene Research Institute is holding free innovation webinars in June. The 30-minute webinars show participants how to be innovators at their credit unions. Kent Sugg, Tinker FCU, Oklahoma City, and Maureen Maddox, Filene Research Institute, will present three Filene i³ innovations: MatriMoney, Savings Revolution, and Prize-Based Savings. The manner in which credit unions have implemented the programs and benefited from them will be addressed. Webinars will be held:
* June 6, 10:30 a.m. (all times are CDT); * June 9, 2:30 p.m.; and * June 11, 10:30 a.m.
Those interested in more information can e-mail their name, credit union and desired session to Kent Sugg at kentsugg@filene.org. Participants must register three days before a session. Space is limited.

CUs letter adds perspective on risk losses

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MIAMI (5/28/08)--There are more than 8,000 credit unions in the U.S., and the vast majority did not make the types of subprime loans that account for problems in the mortgage market, according to a recent letter to the editor in the Miami Herald. Lloyd Gill, executive vice president and chief operating officer, City County CU, Fort Lauderdale, Fla., wrote a letter to the editor, published Monday, recognizing that credit unions are helping borrowers refinance their subprime and exotic mortgages. He wrote in response to a Miami Herald (May 18) article that noted losses by a Florida credit union related to a condominium project that went into foreclosure. Gill, who also is the CUNA Lending Council vice chair, cited a study by the Credit Union National Association, which indicated that credit unions save consumers $6.3 billion per year. “If banks consider this an ‘unfair advantage,’ they are free to convert their bank to a credit union charter at any time,” he wrote.

CUNA CUs address conversion issues in IAmerican BankerI

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WASHINGTON (5/28/08)--Officials with the Credit Union National Association (CUNA) and some credit unions are happy to see that the pace of credit union conversions to mutual savings banks are slowing down, an American Banker article reported Tuesday. Because credit union members have become more educated, switching charters has become more difficult, the article noted. “The more disclosure there is, the more people seem to be against conversion,” said Eric Richard, CUNA executive vice president and general counsel. “I really believe that the system was stacked in favor of management. It’s less so now than it was before.” Bucky Sebastian, CEO of the $2.1 billion asset Tampa, Fla.-based GTE FCU and head of the National Center for Member Trust, Raleigh, N.C., nixes the idea that credit unions convert so they can better compete, the article said. The actual motivation behind the majority of conversions is greed, Sebastian told the American Banker. Top executives and directors--not rank and file credit union members--are the ones who realize profits when converting credit unions become stock companies, Sebastian continued. The credit union industry wants to maintain the status quo with the National Credit Union Administration setting the rules, because easing restrictions against conversions would only diminish the strength of the credit union movement, the article noted. “Those of us who have been in the credit union movement and have a very strong affinity for it would tell you that the issue is all about the membership and the ownership structure,” Tom Dorety, CUNA chairman and CEO of the $6 billion asset Tampa, Fla.-based Suncoast FCU, told American Banker. “At the end of the day, [if conversion] becomes something that is routine and easy, it certainly weakens the entire credit union system,” Dorety concluded.

CU System briefs (05/23/2008)

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* SACRAMENTO, Calif. (5/27/08)--Bert McLane was appointed May 16 to the new position of chief examiner of the California Credit Union Division, which oversees state-chartered credit unions. He will report directly to the governor-appointed Deputy Commissioner of Credit Unions. McLane previously served as credit union manager in the Credit Union Division since 2002. He has worked in regulatory agencies since 1985 and has been with credit union regulatory agency since 1990, according to a press release … * EAST LANSING, Mich. (5/27/08)--The Michigan State University (MSU) FCU announced it has contributed $2.5 million to support the university's Wharton Center for Performing Arts to help fund a new Institute for Arts and Creativity. The $1.450 billion asset credit union will continue its support of the university's Broadway series. The new institute will provide participatory learning programs at the Wharton Center and throughout the state for audiences of all ages (MSU Today May 22) …

Mississippi associations officers awards announced

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JACKSON, Miss. (5/27/08)--Over 600 managers, volunteers, staff and guests from more than 60 Mississippi credit unions attended the Mississippi Credit Union Association’s 71st annual meeting in Biloxi, Miss., May 7-10. The association membership re-elected four directors and elected two new directors during the meeting. New directors are:
* Doug Adams, MUNA FCU, Meridian; and * Dion Williams, Central Sunbelt FCU, Laurel;
The incumbent directors include:
* Billy Bridges, Mutual CU, Vicksburg; * Lavina Crocker, MS DHS FCU, Jackson; * Lt. Col. Dean Todd (Ret.), Keesler FCU, Biloxi; and * Elmer Dickens, Gulf Coast Community FCU, Gulfport.
During the event, two individuals also were awarded the state’s highest honor, induction into the Mississippi Credit Union Hall of Fame:
* James Vance, board chairman, Meridian Mutual FCU, Meridian; and * J.R. “Russell” Stubbs, director, McComb (Miss.) FCU.
Also, Central Sunbelt FCU, Laurel, was named the top 2007 Credit Unions for Kids fundraiser.

New York league has new name headquarters

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LATHAM, N.Y. (5/27/08)--The New York State Credit Union League, which has represented New York’s credit unions for 91 years, is now known as the Credit Union Association of New York.
Pictured is a front view of the new home of the Credit Union Association of New York in Albany. N.Y. (Photo provided by the Credit Union Association of New York)
In addition to the new name, the association will take on a new identity with a new look, new corporate website and Web address, new contact e-mails, new tagline and a new address. “By leading with the words ‘credit union,’ this new name instantly communicates what we’re all about,” said association President/CEO William J. Mellin. “By no longer beginning our name with ‘New York State,’ we will clear up any confusion about our organization being a state agency. All of our constituents--legislators, government agencies, credit unions and the public--will know at a glance who we are and who we serve.” A new logo, representative of a compass, expresses the association’s role in navigating the current business and legislative climate to help credit unions reach their goals. Together with the new “Leading the Way” tagline, the symbol, like the needle of a compass, points the way forward. As part of the re-branding, the name of the Association’s weekly newsletter, League Lines, will change to The Point. Employee e-mail addresses also will change to a more commonly accepted standard--firstname.lastname@cuany.org. The new website, www.cuany.org, will debut in late June with easier navigation, more resources and a search engine to help visitors find what they want quickly and easily. Breaking news and upcoming events will be a highlight of the website’s new homepage. The association’s main press room will also reside on the homepage with separate press rooms for each of the association’s core areas: governmental affairs, member services, outreach and regulatory compliance. The association now is operating out of its new location: 1021 Watervliet-Albany Rd., Albany, NY 12205, a building shared with frequent partner, Members United Corporate FCU. All telephone numbers, as well as the P.O. Box 15118, Albany NY 12212-5118 mailing address, will remain the same.

Filene Address social environmental concerns

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MADISON, Wis. (5/27/08)--Credit unions can address mounting social and environmental concerns as they build a foundation for innovation and growth, according to a recent Filene Research Institute study.
By doing this, credit unions can outperform their competitors in today’s business and--even more important--outrun them in tomorrow’s technologies and markets, say Stuart Hart and Monica Touesnard of Cornell University’s Center for Sustainable Global Enterprise in “Back to the Future: Integrating into Credit Union Strategy.” Rather than competing directly with banks, it makes more sense for credit unions to go “back to the future” by using their unique historical and organizational characteristics. The characteristics include tax-exempt status, cooperative ownership, community lending and focus on the underserved to offer a set of products and services that differentiates them from banks and other financial services providers, Hart and Touesnard conclude. The broad domain of sustainability offers such a landscape of opportunity, say the authors. Current strategies to minimize waste and emissions for operations might include green building initiatives and paperless services such as bill pay and online banking. Product stewardship strategies designed to integrate stakeholder services into business processes might include sustainability reporting initiatives and in-house sustainability consulting services. For the future, a strategy of clean technology promises to develop competencies such as financing green products and investment in clean technologies. Sustainability strategies also hold potential to create a shared road map for meeting unmet needs, such as REAL Solutions products and services. REAL Solutions is a National Credit Union Foundation program to further credit unions’ efforts to serve low-wealth and modest means households. “The opportunities in this report suggest that financial institutions are just beginning to experiment with programs and initiatives related to sustainability,” said George Hofheimer, Filene’s chief research officer. “As a result, we have yet to realize the challenges and opportunities implicit in sustainability strategies.”

Pa. treasurer testimony describes CUs Better Choice

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HARRISBURG, Pa. (5/27/08)--Pennsylvania State Treasurer Robin Wiessmann praised the Credit Union Better Choice program--a payday lending alternative--and confirmed her commitment to supporting the program in testimony before the Pennsylvania House Finance Committee May 20. The testimony was in support of House Bill 2295, which extends part of the investment authority for Treasury’s funds. The extension will allow Treasury to continue to broadly invest in securities, including equities and mutual funds, until Dec. 31, 2010. It also provides the appropriate authority to obtain reasonable returns with reasonable risk assessment (Life is a Highway May 23). Wiessmann described the Credit Union Better Choice program, which was developed in conjunction with the Pennsylvania Credit Union Association. The program is “believed to be the only program in the nation to provide a statewide alternative to payday lending, protecting consumers from the exorbitant fees that oftentimes trap them in a debt cycle,” she said. “Credit Union Better Choice provides consumers with low-cost, short-term loans and an investment in their futures through the program’s financial literacy and savings components,” Wiessmann continued. Wiessmann concluded her remarks saying: “I am committed to keeping an eye out not only for future risks, but also for emerging opportunities for positive returns for the Commonwealth. Positive returns can be enhanced, however. I strongly believe that we can do well for our funds and, at the same time, do good for Pennsylvania stakeholders. The KeystoneHELP and Credit Union Better Choice programs are perfect examples of this philosophy.” Christina Mihalik, association assistant vice president, governmental affairs, attended the hearing.

Sunmark FCU shares best practices in hiring keeping staff

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LATHAM, N.Y. (5/27/08)--Making the workplace fun is one of the best ways to attract and retain employees, a New York credit union CEO told participants at a seminar sponsored by The Business Review Wednesday. “Financial services can be a little dry,” Bruce Beaudette, president/CEO of the $432 million asset, Schenectady, N.Y.-based Sunmark FCU, said. “We still manage to have a lot of fun. It works well for retention and for attraction [of employees]. We do a lot of things to create the fun.” Beaudette was one of three panelists participating in a seminar focused on recruiting and retaining employees as part of The Business Review’s best practices seminar series. One way to keep employees enjoying their work--which is important--is to pay them referral fees to find workers to fill company positions, Beaudette told the paper. Asking oddball questions--about one’s hobbies for instance--when interviewing is a good way to catch candidates off guard and find out what they are passionate about, he added. Distance is one barrier to finding good workers, Beaudette said. With gas prices at or near $4 a gallon, people don’t want to travel more than 15 minutes to work. Before, they had no problem driving 45 minutes to work, he added.

Supercharge membership growth via free audio conference

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MADISON, Wis. (5/27/08)--Credit unions can learn strategies for increasing their membership growth, as well as hear about the work and preliminary findings of the Credit Union National Association's (CUNA) Membership Growth Task Force in a free audio conference Thursday. at 11 a.m. to noon CDT. The “Supercharging Your Membership Growth Audio Conference” will begin with an overview of the task force’s purpose, activities, and findings to date. From there, the conference will become an open forum so participants can provide their ideas and feedback, and share success stories. Participants from fast-growing credit unions will be encouraged to share any policies, practices, and strategies they’ve found especially helpful. Overall, the focus will be on several areas deemed by the task force to be critical in increasing membership growth:
* Awareness and image; * New markets; * Best practices; * Efficiency and back-office issues, and * Growth metrics.
The CUNA Membership Growth Task Force--chaired by Texas Credit Union League President/CEO Dick Ensweiler--was established to investigate, report on, and encourage credit unions to embrace opportunities, techniques, and processes that will increase membership retention and growth. For more information or to register for the free audio conference, use the resource link. Program content questions may be directed to 800-356-9655, ext. 4249.

Ohio payday loan sent to governor

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COLUMBUS, Ohio (5/23/08)--Ohio's payday loan reform bill is on its way to Gov. Ted Strickland for signature, which is expected next week. Members of the state House of Representatives voted 70-24 Tuesday to approve Senate changes in the bill (WHIO.TV.com May 20). The bill caps interest rates on short-term loans at 28% and limits borrowers to four such loans a year. Credit unions in the state have received positive attention as alternatives for payday loans (News Now May 20). Payday lenders opposed to the bill said they would have to leave the state.

N. Carolina bill earmarks fin ed funds for three CUs

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RALEIGH, N.C. (5/23/08)--A bill that would appropriate financial literacy funds through three North Carolina credit unions has been introduced in the state legislature. Senate Bill 1728 would appropriate $2.5 million for the 2008-2009 school year to the North Carolina Minority Support Center Inc., to expand economic development lending and financial literacy. The funds would award economic development loan funds to $20 million asset Generations Community CU, Durham; to the $8.6 million asset Greater Kinston CU, Kinston; and the $27.4 million asset First Legacy Community FCU, Charlotte.

Mobiloil FCU receives FHLB 90000 grant deposit

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BEAUMONT, Texas (5/23/08)--The Beaumont Habitat for Humanity was a recipient of a $90,000 grant from the Federal Home Loan Bank of Dallas as part of the bank’s Affordable Housing Grants program. Habitat deposited the grant into its Mobiloil FCU account in Beaumont. The $214 million asset Mobiloil has been involved with Beaumont Habitat for Humanity for the past six years. Habitat’s director is a member of the credit union (LoneStar Leaguer May 22). Throughout the past year, credit union employees volunteered to help build homes for the organization. Kim Heinz, CEO, Mobiloil FCU, working with other volunteers, helped frame a home in a neighboring community three weeks ago. “It’s a pretty awesome feeling when the walls go up on a home,” Heinz told the Texas Credit Union League. “You are just overcome by so much emotion--a feeling that you’ve achieved something great.” Mobiloil FCU has a program called CU Share, which rewards employees for volunteer work in the community. Each hour of volunteer work pushes them closer to being a top volunteer. The reward for being the top volunteer is the credit union donates $500 to the top volunteer’s organization of choice.

Montana CUs honor professional volunteers

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HELENA, Mont. (5/23/08)--Gary Clark, president/CEO of Missoula FCU, was recently named Montana Credit Union Professional of the Year for 2008.
Gary Clark (left), the 2008 Montana Credit Union Professional of the Year, poses with Tracie Kenyon, president/CEO of the Montana Credit Union Network.
From left, Richard Lohof, Bill Pedersen, Robert Fox, Richard Naumen Sr., and Greg Erpenbach with their volunteer awards. Recipients David Grubbs, Michael Mennie, and William Pedersen are not pictured. (Photos provided by the Montana Credit Union Network)


The award, presented by the Montana Credit Union Network, recognizes Clark’s contributions to credit unions over the course of his 31-year career. He has been president/CEO of the credit union for 13 years. Seven members of Avanta FCU’s board of directors were recognized for their commitment and contributions to the Montana credit union movement. Richard Nauman, Sr. (Park City), Robert Fox and Richard Lohof (Laurel), Gregory Erpenbach, David Grubbs, Michael Mennie and William Pedersen (Billings), were recognized as the network’s 2008 Mitch Reed Volunteers of the Year. Together the seven have a combined total of 158 years of experience volunteering for credit unions. “We’re very fortunate to have a group of board members that are so engaged in our credit union, our activities, and the credit union movement overall,” said Rhonda Diefenderfer, Avanta FCU president/CEO.

Membership Growth Northwoods Community CU

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PARK FALLS, Wis. (5/23/08)--Growth doesn’t come easy in Wisconsin’s northwoods. Just ask Susan Schmidt, president/CEO of Northwoods Community CU. Her credit union is headquartered in a town--Park Falls, Wis.--that’s experienced annual average population declines of 2% since 2000, according to U.S. Census data. And the county (Price County) that serves as the credit union’s home base has population that’s been declining at an annual average rate of 1%. But over this same period, Northwoods Community CU memberships actually increased: The credit union’s 0.5% average annual membership increase is laudable given the area’s demographic changes. And its focus on reaching out and deepening relationships with current members is producing fast asset growth. New products, membership growth drives directed at specific groups, and a continual focus on member services are the forces behind her credit union’s solid growth. In fact, the $50.1 million asset credit unions realized 17.9 % growth in assets this past year. This is the second installment of News Now’s Membership Growth weekly interviews with fast credit union growers. The series is as part of an initiative of the Credit Union National Association (CUNA) Membership Growth Task Force. It focuses on fast "organic" membership growth, not growth by merger or indirect loans. The task force, chaired by Dick Ensweiler, president of the Texas Credit Union League, was convened at the request of CUNA's Immediate Past Board Chair Allan Kemp McMorris. Its purpose is to investigate, report on, and encourage credit unions to embrace opportunities, techniques and processes that will increase credit unions' membership retention and growth. “The credit union’s mission is to provide outstanding service and security to our members. A focus on member services has always been a key for us,” Schmidt said. Because of that focus, the credit union introduced two new products this past year. The “Premier Account” is a new account that allows members to receive higher interest rates on deposits in their accounts and an increase in basis points on certificates of deposit. “The Premier Account provides excellent rates, cash availability and alternative deposit relations--which mean members can branch into other accounts and can receive the increased basis points that they get with certificates of deposit,” Schmidt said. Another product introduced in 2007 was a “very aggressive certificate program” that allows Northwoods to pay above-market rates, Schmidt said. The certificate pays out at 7% over the short term, but the credit union places a cap on the dollar amount that can be put into the certificate program, she added. One of the prime groups the credit union targets is youth. “We are very active with youth in our area because children are our future, and we want to get them as members and keep them for life,” Schmidt explained. Northwoods is proactive with children. It features kids clubs in which grandparents can open accounts for their grandchildren. The credit union also is active in financial literacy for kids, and has an annual drawing for two computers. Each time youth make a deposit to their account, they fill out a ticket that increases their chances of winning one of the drawings. Those in the “Teen Cent$ Club” are eligible for a drawing for a laptop computer. Kids, six months through 12 years old, who are in the Kangaroo Kids Club, are eligible for a desktop computer drawing. The credit union also is holding a membership drive for adults in which existing members are eligible for two drawings for a flat screen TV when they refer a new member who opens an account at Northwoods. Northwoods continually nurtures relationships with real estate brokers in the area to make them aware that the credit union is available for home loans. The credit union always tries to solicit small businesses for their financial needs. Northwoods has a director of business development, who heads up this area to establish fruitful relationships. Northwoods purchased a facility in nearby Ashland, Wis., opened a branch and put in an ATM and a drive-up facility. “We were leasing a building in that area, and based on a member survey, we realized our members wanted more service, so we purchased a building. The Ashland area is a good membership area for us,’ Schmidt said. Northwoods serves a seven-county area in northwestern Wisconsin, and has been a community credit union since the early 1970s. A combination of factors was responsible for the credit union’s solid growth in 2007. “We generated good income for the year by reducing expenses, and also increased loan investment interest income that allowed us to experience good return on assets,” Schmidt explained. “Our youth program in financial literacy continues to move in a good direction, with our kids club growing over 40% in new members last year. “Also, visits to our website were up 40% from the past year. It provides ways to grow demand for our products and services,” she added. In the future, the credit union intends to get more involved with indirect lending. Northwoods just started to venture into that area this year. "We are partnering with a vendor to help us be more aggressive in expanding membership lending for autos, Harley Davidson motorcycles and recreational vehicles,” she concluded. Anyone who wants to contact the CUNA Membership Growth Task Force can e-mail the account established for this purpose at cunamgtf@cuna.coop

Navy Federal to expand FOM to all armed forces

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VIENNA, Va. (5/23/08)--Navy FCU says it will expand its field of membership to include all branches of the armed forces. Membership benefits will be available to all Navy, Marine Corps, Army, Air Force active duty, reserve and guard personnel and all civilians working in the Department of Defense, the $35 billion asset credit union said in a press release. The credit union outlined two reasons for the expansion. "In today's military environment," said President/CEO Cutler Dawson, "all branches of the armed forces share resources, conduct joint operations, serve on the same bases, and use the same exchanges, commissaries, and medical facilities. So we believe the time is right to extend that legacy of service …" Also, all members would benefit because membership growth would allow the credit union to offer a broader range of products and services at competitive rates. The credit union's name will remain the same. Last year the credit union increased its worldwide network of branches by 25% to 150 branches and hired 2,600 new employees for a total of 7,300 employees worldwide. Plans are underway to more than double the number of full-service branches in the next four years.

CDCU opens branch in Brooklyn underserved area

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BROOKLYN, N.Y. (5/23/08)--Brooklyn Cooperative FCU--the youngest community development credit union (CDCU) in New York City--celebrated the opening of a new branch in the underserved Bedford-Stuyvesant neighborhood last weekend.
From left: CDIF Fund Director Donna Gambrell; U.S. Rep. Nydia Velazquez; and Brooklyn Cooperative FCU CEO Jack Lawson, in front of the credit union's new branch. (Photo provided by the National Federation of Community Development Credit Unions)
Donna Gambrell, director of the federal Community Development Financial Institutions (CDFI) Fund, presented an award check of $393,998 to the credit union’s leadership. Also on hand were U.S. Rep. Nydia M. Velázquez, chairperson of the House Small Business Committee; U.S. Rep. Edolphus Towns, a member of the Energy and Commerce Committee; and State Assemblyman Darryl Towns, chairman of the New York State Assembly Banks Committee. They expressed their support for the federal CDFI Fund and the New York State CDFI Fund. The state fund was created last year to help CDFIs leverage increased federal and private sector support. New York City Council Member Letitia James has also been a strong supporter of the credit union. “Now more than ever, during these tough economic times, it is important for all New Yorkers to have the opportunity to chart their own course to financial freedom," said Velazquez. Since its founding in 2000, Brooklyn Cooperative FCU has grown to $7.3 million in assets and serving 4,765 members. It has received six financial assistance and technical assistance awards totaling more than $1.1 million from the CDFI Fund since 2001. The grants enabled the credit union to establish a firm financial base, and with the most recent award, to branch out from its headquarters in the Bushwick neighborhood of Brooklyn. The National Credit Union Foundation awarded the credit union a $50,000 Innovation Grant earlier this year to support the underserved branch opening. “I’ve been working with credit unions and other CDFIs for a number of years as chairman of the Assembly Banks Committee," said Towns. "But throughout that time I’ve been dying to have a CDFI that I could call my own, one that is addressed right in my district, and I’m very happy to finally welcome the Brooklyn Cooperative FCU to this neighborhood." The new branch will be open five days a week and will offer the credit union's core financial services: low-fee loans, savings accounts, checking accounts and ATM card, tax preparation assistance, homeownership counseling, housing loans, and small-business technical assistance and loans. Cliff Rosenthal, president/CEO of the National Federation of Community Development Credit Unions, described Brooklyn Cooperative FCU as “one of the most successful start-up credit unions of the last decade anywhere in the country."

MCUA studying subprime impact on Missourians

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ST. LOUIS (5/23/08)--Missourians, like consumers across the country, are being hit hard by the subprime mortgage crisis--and it isn’t just those losing homes to foreclosure who are hurting. The Missouri Credit Union Association (MCUA) is examining the trends and possible solutions for everyone affected. MCUA commissioned a study on how the subprime mortgage crisis has affected Missourians from Nancy Pierce, Ph.D., of the Tipton Research Group and Robert Weagley, Ph.D., chair of the Personal Financial Planning Department at the University of Missouri-Columbia. The study analyzes the mortgage activity 114 counties and St. Louis. Its report will suggest possible responses by lawmakers, credit unions, and consumers Missouri is listed by the Center for Responsible Lending as one of 24 states projected to lose more than $1 billion in home values from foreclosure. An estimated 17,000 homes would be lost to foreclosure. In turn, this affects another 738,000 homeowners whose property values would decline. The overall declines could impact tax revenues for many communities already financially strapped due to the economic downturn, said MCUA in a press release. According to Realtytrac, Missouri’s foreclosure rate at the end of 2007 was up 91.4% from year-end 2006, and its mortgage delinquency rate is above the national average. Missouri ranked fifth in the nation in its mortgage delinquency rate. Because of this, Missouri foreclosures could increase in the last half of 2008. The MCUA study results include counties and demographics most affected by the mortgage crisis, and predictions for the future. MCUA will release the final study results in early July, and provide suggested responses to help lawmakers, homeowners, credit unions, and communities take action. For more information on the study contact Peggy Nalls, senior vice president/public and legislative affairs, at pnalls@mcua.org or 573-636-1010.

CUNA closed Monday for holiday

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WASHINGTON and MADISON, Wis. (5/23/08)--The Washington, D.C., and Madison, Wis., offices of the Credit Union National Association will be closed on Monday, in observance of Memorial Day. News Now will not publish on Monday but will resume regular publication Tuesday.

Governors ID-theft-bill release quotes NYCUF

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ALBANY, N.Y. (5/23/08)--New York Gov. David A. Paterson's press release Wednesday introducing legislation to strengthen the state's identity theft laws includes a quote from Diane LaVigna-Wixted, executive director of the New York Credit Union Foundation. The bill would restrict the ability of employers to use an employee's personal information--including full Social Security number--or file the information in a non-secured area and more. "We at the New York Credit Union Foundation have been working hard, with the Consumer Protection Board and members of the New York State Legislature, to inform credit union members about the dangers of identity theft," said LaVigna-Wixted in the release. "We commend Gov. Paterson for stepping up to the plate and advancing greater protections for all of us," she added. Noting the implications of identity theft for all consumers and the general public, the foundation produced a series of radio and television public service announcements and an educational 12-minute video for web streaming on its prevention. The video will debut this fall.

Phishing attempts made against CUs in three states

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MADISON, Wis. (5/22/08)--The latest phishing expeditions using credit unions to lure personal financial information away from members and other consumers have occurred in Missouri, Illinois and Florida. Authorities have reported phishing attempts at three credit unions. It is not known whether the phishers succeeded in obtaining account information. In the incidents:
* Missouri Attorney General Jay Nixon said consumers in Kansas City, Mo., are receiving phone calls, text messages and e-mails purporting to be from Kansas City-based Mazuma CU. The contacts are actually from identity thieves, he said. * Land of Lincoln CU in Decatur, Ill., was in the process Monday of notifying credit and debit card account holders that scamsters are using its name in phone calls, text messages and other phish attempts. Several residents received computer-generated phone calls that claiming to be from the credit union and advising their account was closed for security reasons. (Herald-Review May 20). * McCoy FCU, based in Orlando, Fla., also was warning members about a text-messaging scam using its name. The scam urges the recipient to call a phone number and provide account information to fix a "problem" with the account.
The credit unions and authorities emphasized that credit unions and other financial institutions would not solicit such information.

Dallas FHLB awards 1 million for affordable housing to CU

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DALLAS (5/22/08)--The Federal Home Loan Bank of Dallas announced it has awarded a nearly $1 million Affordable Housing Program (AHP) grants to Jackson, Miss.-based Hope Community CU to sponsor three housing projects in Louisiana. The grants are part of $9.1 million in AHP grants to 30 projects in Arkansas, Louisiana, Mississippi, Tennessee and Texas. The grants will help create 1,743 housing units for very low- to moderate-income families. Hope Community CU's grants totaled $977,000 out of nearly $2.4 million provided to projects in Louisiana. They include:
* $420,000 for 60 rental units sponsored by Gulf Coast Housing Partnership in Baton Rouge, La.; * $182,000 for 26 ownership units sponsored by Gulf Coast Housing Partnership in Hammond, La.; and * $375,000 for 54 rental units sponsored by Gulf Coast Housing Partnership in Westwego, La.

First CU in East L.A. celebrates historic opening

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MONTEREY PARK, Calif. (5/22/08)--The historic opening of the first credit union branch in East Los Angeles was celebrated Friday, May 16, by E1 Financial CU with a grand opening ceremony.
From left: Monterey Park (Calif.) Mayor and E1 Financial CU Board Member Sharon Martinez,; Benjamin Cardenas, district director for U.S. Rep. Grace Napolitano; State Senate Majority Leader Gloria Romero; E1 President/CEO Lynn Bowers; Assembly Member Ed Hernandez; E1 Board Chair Luchus Mack; Mukai Maravilla Property Development President Ron Mukai (property owner); E1 Community Relations Liaison Dennis Gutierrez; and E1 East L.A. Branch Manager Willie Polanco. (Photo provided by E1 Financial CU)
Community, civic and industry leaders were on hand to congratulate E1's entrance into unincorporated Los Angeles, which has not seen a financial institution open in more than 20 years. The branch opening comes at a time of increasing redevelopment and financial opportunities for the area, said the credit union in a press release. During the ceremony, State Senate Majority Leader Gloria Romero officially opened her membership with E1. "I now know what E1 stands for," she said. "It stands for East L.A.'s first credit union." The branch is located underneath Romero's district office. As part of the ceremony, the California Credit Union League presented certificates of appreciation to Romero and L.A. County Supervisor Gloria Molina for their dedication to redevelopment in the community and their support of credit unions.

Missouri helps pass legislation for ID theft victims

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JEFFERSON CITY, Mo. (5/22/08)--Missouri credit unions are seeing more consumers--both members and non-members--targeted by identity theft scams. To assist consumers fight identity theft, Missouri credit unions were instrumental in helping to pass legislation to assist victims. Missouri House Bill 1384 changes the laws regarding identity protection and gives identity theft victims the right to have an incident report filed by their law enforcement agency and to receive a copy of the report. Currently, not all Missouri law enforcement agencies file reports. The Missouri Credit Union Association (MCUA) worked on the bill--which passed in the House--early in the legislative session with its sponsor, State Rep. Stanley Cox (R-118). However, H.B. 1384 stalled in the Senate Judiciary Committee when the committee chairman questioned the need for the bill. Credit unions played an important role in getting the bill passed by contacting law enforcement agencies and providing proof that not all police departments were filing reports, MCUA said. Because of information provided by MCUA, the chairman passed the bill out of committee. The bill was combined with a credit freeze bill sponsored by State Senate President Pro Tem Mike Gibbons (R-15). The bill passed on the final day of the legislative session, May 16. The identity theft bill will take effect Aug. 28. “This is the most significant consumer protection legislation passed this year by the Missouri General Assembly,” Cox said. “I acknowledge the invaluable contribution of Sen. Mike Gibbons and the Missouri Credit Union Association in this effort. It will significantly reduce the injury caused by identity theft, which is a threat to all consumers.” “Since the House Consumer Protection Committee was eliminated several years ago, there has been no specific committee with a focus on consumer interests,” said Peggy Nalls, MCUA senior vice president, public and legislative affairs. "We were happy to serve as the consumer watchdog on this issue and help support passage of the bill.”

Corporate One announces new board members officers

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COLUMBUS, Ohio (5/22/08)--Corporate One FCU announced the election of three new board members and named officers at its annual meeting held in April in Columbus, Ohio. Corporate One is a $5.1 billion asset Columbus-based wholesale financial services provider to nearly 800 U.S. credit unions. The three new board members are:
* Ronald J. Budzinski, president, First Trust CU, Michigan City, Indiana; * Gerald D. Guy, president/CEO, KEMBA Financial CU, Columbus; and * Janice L. Thomas, president, PSE CU, Parma, Ohio.
In a reorganization meeting after the annual meeting, the 2008 board officers named were:
* Chair: Jerome R. Valco, CEO, The Ohio Educational CU, Cleveland; * Vice Chair: Guy; * Treasurer: John J. Shirilla, president/CEO, Best Employees FCU, Walton Hills, Ohio; and * Secretary: Phillip R. Buell, CEO, Superior FCU, Lima, Ohio.
Corporate One’s board is composed of nine directors, each elected by member credit unions to a three-year term.

New York state-chartered CU roundtable held

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LATHAM, N.Y. (5/22/08)--A state-chartered credit union roundtable kicked off the New York State Credit Union’s League’s 2008 annual meeting and Governmental Affairs Conference this week in Albany, N.Y.
Mark Treichel, NCUA Region 1 director, listens to credit unions discuss third-party due diligence during the New York State Credit Union’s League’s state-chartered roundtable discussion.
The event was created to address regulatory and legislative issues that face New York’s state-chartered credit unions. Henry Meier, league associate counsel and director of compliance, moderated the roundtable discussion. National Credit Union Administration (NCUA) Region I Director Mark Treichel attended, and Legislative Counsel Tom Barletta participated on behalf of the New York State Banking Department. Treichel pointed out that credit unions have done a good job avoiding most of the mortgage-related problems that have impacted other segments of the financial services industry. League participants questioned Treichel about the regulatory impact of
From left: Thomas G. Siciliano, general counsel, Municipal CU, New York; Tom Barletta of the New York State Banking Department; and Henry Meier of the New York State Credit Union League. (Photos provided by the New York State Credit Union League)
NCUA’s increased emphasis on third-party due diligence and the pending implementation of new regulations related to identity theft. Tom Barletta, legislative counsel at the New York State Banking Department, discussed the department’s goal to make the state charter more desirable to credit unions. “The meeting underscored how united our members are in advocating for a strong dual-charter system,” Meier said. “The legislature has made important strides in strengthening its credit union charter, and our state-chartered credit unions are the best advocates we have for making sure that regulators take full advantage of these changes.”

Louisiana fin ed bill progresses

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HARAHAN, La. (5/22/08)--The Louisiana Credit Union League reports that a financial literacy education bill in the state is making progress. Senate Bill 205, sponsored by Senate President Pro Tempore Sharon Weston Broome (D-15) and Sen. Cheryl A. Gray (D-5), would create the Louisiana Financial Literacy Education Improvement Act, which would develop and implement programs to promote financial literacy and improve the financial education of Louisiana citizens. The bill received a favorable vote on final passage in the full Senate and will soon be introduced in the House of Representatives, said the league (eNews May 21). As SB 405 moves forward, it has received a unanimous favorable nod from the Senate Education Committee, a favorable review by the Senate Finance Committee for its fiscal impact, and a review by the Legislative Bureau, said the league.

CU System briefs (05/21/2008)

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* PEWAUKEE, Wis. (5/22/08)--The Wisconsin Credit Union League Board approved the sale of the league's office building in Pewaukee. It also approved a corresponding lease for about one-third of the building for the league's continued use, said the league's newsletter (The League May 19). The number of league staff had diminished over the years and the building had grown too large for its current and future needs, the league said. It expects the sale to close this summer and the space to be occupied by the league will be available in late fall … * NEW YORK (5/22/08)--The Institute for American Values honored Rita Haynes, former chair of the National Federation of Community Development Credit Unions and CEO of the Faith Community United CU, Cleveland, Ohio, with the institute's New Thrift Award at a conference in Washington, D.C. The federation and institute have built an alliance to promote thrift and confront the "debt culture," and an accompanying research report on the topic. The report cites the programs of several federation members, including North Side Community FCU, Chicago; Faith Community United CU, Cleveland; and ASI FCU, New Orleans. Also cited were Community Development Partner State Employees' CU, Raleigh, N.C., and Prospera CU, Appleton, Wis. (Photo provided by the National Federation of Community Development Credit Unions)… * LA PORTE, Texas (5/22/08)--Jack V. McAdoo has been appointed the new president/CEO of Beacon FCU, the credit union's board announced. The appointment was effective April 14. McAdoo has more than 20 years of financial services experience and previously served as president/CEO of StarTrust FCU, Houston. During his ll years there, the credit union grew from $21 million in assets to nearly $100 million. Beacon, based in La Porte, has $90 million in assets and 15,000 members (Pasadena Citizen May 20) … * NORTH HIGHLANDS, Calif. (5/22/08)--Richard Ditzel, a former finance and account manager at Sacramento-based Capital Power CU, pleaded guilty Tuesday to embezzling more than $400,000 from the credit union between 2001 and 2007 (Sacramento Business Journal and Sacramento Bee May 20). He admitted he diverted checks, made false entries in the credit union's general ledger, and used the proceeds to acquire collectible coins. The credit union discovered the embezzlement during its merger last summer into SAFE CU, which is based in North Highlands. Sentencing was scheduled for Aug. 5. He faces up to 30 years in prison and a fine of $1 million plus restitution orders … * BAKU, Azerbaijan (5/22/08)--The Azerbaijan Credit Unions Association (ACUA) has launched a website: http://www.alia.az. The site, which works in Azeri, Russian and English, will inform users about ACUA, its managers, members, partners and development strategy, and international credit cooperatives in general (Turan Information Agency May 15). Also, a two-day international conference was held May 15-16 in Baku, dedicated to the fifth anniversary of ACUA. Elchin Baghirov, ACUA chairman, addressed the conference, reported on ACUA's progress and handed out awards to those who helped the association’s development. Delegates from similar associations in Russia, Lithuania and Kyrgyzstan took part in the conference ... * FARMERS BRANCH, Texas (5/22/08)--Art Shaw, who came to the credit union movement in 1952 as a volunteer and organized numerous Texas credit unions, died. Shaw was inducted into the Texas Credit Union Hall of Fame in 2003. He was elected to the Texas Credit Union League board of directors in 1980, where he served for 14 years. He also served on the Supervisory Committee of Southwest Corporate FCU, Plano, Texas. A lifetime member of the Permian Chapter of Credit Unions, he served as chapter president for three terms. Shaw was the chapter’s CUNA Mutual policy owner’s representative for more than 20 years and was selected as the league’s policy owner representative for the state (LoneStar Leaguer May 21) ...

WesCorp has strongest year to date

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TORREY PINES, Calif. (5/21/08)--Despite the turmoil in the markets during 2007, Western Corporate FCU (WesCorp) experienced its strongest year to date, posting total assets of $31.6 billion, the corporate announced at its 39th annual meeting Monday in La Jolla, Calif. Net interest income increased by 47% on the year to $157.6 million, and the efficiency ratio ended the year at 46.3%, down from 56.56% at year-end 2006. "Our financials are super strong; the strongest year we've had," WesCorp President/CEO Bob Siravo told the 275 CEOs, chief financial officers and executives attending. He added that WesCorp and other corporates, including U.S. Central, serve as a shield, protecting their members from the instability of today's capital markets. Siravo spoke of his disappointment that VolCorp's bid to merge with WesCorp was not approved by federal regulators, but said WesCorp's merger with SunCorp is ready to move ahead as planned, contingent on further market stabilization. He noted the spreads are narrowing. During the year, WesCorp added 27 new member credit unions, bringing its total membership to 1,055 credit unions in 44 states and Guam. Also at the meeting:
* Three directors were re-elected to three-year terms. They were: Adam Denbo, president/CEO, California Agribusiness CU, Bueno Park, Calif.; Diana Dykstra, president/CEO, San Francisco Fire CU, San Francisco; and Jim Jordan, president/CEO, Schools Financial CU, Sacramento. * The executive leadership remained unchanged. Bob Harvey, president/CEO of Seattle Metropolitan CU, Seattle, continues as chairman; Jordan as vice chairman; and Timothy Kramer, president/CEO of KeyPoint CU, Santa Clara, Calif., as recorder/financial officer.

Columnist Start with a CU for good rate yields

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NEW YORK (5/21/08)--Credit unions, cyber banks and big-box financial institutions are upping the yields on short- and long-term certificates of deposit (CDs) to lure in depositors looking for a safe place to park $1,000, says a columnist in Monday's issue of TheStreet.com. Farnoosh Torabi, writing about the safety of CDs in uncertain economic times, recommends credit unions as one of the starting points for consumers with an extra $1,000 searching for secure deposit instruments to park their savings. "Credit unions tend to offer higher yields, since they do little marketing and don't depend on huge spreads to please shareholders," says the article. Experts say credit unions have a history of better savings rates than traditional banks, Torabi writes. Daniel Penrod, industry analyst for the California Credit Union League, explains in the article that conservatively, credit unions offer half to three quarters of a point more on CD yields than banks. He points out that the biggest myth about credit unions: that few people qualify to join unless they have a certain job, ethnicity or location. Most of the population is eligible to join a credit union, he says, adding that with shared branching and the nationwide credit union CO-OP Network, credit union members actually have 25,000 branches to use. To access the original article, use the link.

Three AACUC board seats up for election

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SHREVEPORT, La. (5/21/08)--The African-American Credit Union Coalition (AACUC) has three board positions up for election. The board seats will be voted on Aug. 10 at the AACUC 2008 annual business meeting in Houston. The positions currently are held by Bert Hash Jr.; Hubert Hoosman Jr.; and Lynda McDaniel. Each of the incumbents is seeking re-election to the AACUC board. The 2008 Nominating Committee consists of Leroy Nesbit Jr., chairman; Bob Harvey Jr.; and Sheilah Montgomery. AACUC’s mission is to increase the global credit union movement's strength by adding the focused perspective and energy of credit union volunteers and professionals of African-American and African descent. Those interested in seeking a position on the AACUC board of directors, should submit a letter of intent, a resumé, a biographical sketch of 100 words or less and a photo by midnight June 6 to: Leroy Nesbit Jr, Chairman AACUC Nominating Committee 12093 River Bend Drive Grand Blanc, MI 48439 e-mail: Nesbitgroup@aol.com

CU System briefs (05/20/2008)

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* MADISON, Wis. (5/21/08)--The Credit Union National Association (CUNA) is weighing its options about appealing a decision by a Madison, Wis., employment commission over an action brought against the association by a former employee. The action was brought over allegations by the former employee of discrimination and retaliation by CUNA toward the employee. In an "interim order" issued by a hearing examiner of the Madison Employment Opportunities Commission (MEOC), CUNA is directed to reach an agreement with the former employee for back pay, benefits, expenses and a judgment of $75,000 for damages. CUNA is studying the interim decision to determine its next steps. Meanwhile, in a statement, CUNA said it "strongly disagrees" with the decision, and reiterated that "CUNA does not discriminate or retaliate against any of its employees under any circumstances, and did not do so in the case at issue" … * SOUTH BEND, Ind. (5/21/08)--Two teens, ages 15 and 16, were apprehended with 25 minutes of an attempted robbery of a South Bend credit union Monday morning. At about 10:13 a.m., the suspects allegedly each gave a note demanding money to separate tellers, said South Bend Police. However, the tellers alerted police. After waiting a bit, the boys left. One teen was caught in the parking lot with help from a police dog. The other was tracked to a dumpster. One of the suspects was treated for a dog bite. No weapons were found, and no money was taken, police said (South Bend Tribune May 19) … * COLORADO SPRINGS, Colo. (5/21/08)--Lois Carlock, education and event manager at Colorado Springs-based Ent FCU tries out one of the 200 cell phones the credit union collected from its employees and members. The cell phones will be donated to a local agency, TESSA, which offers prevention, intervention and treatment services to women and children who are victims of domestic violence and sexual assault. TESSA reprograms the old cell phones for its clients so that women have a means to call 9-1-1 in an emergency. (Photo provided by Ent FCU) … * LARGO, Md. (5/21/08)--Employees of Prince George's Community FCU joined local law enforcement agencies in a Buckle Up for a Buck campaign May 9 and yesterday at an intersection in Largo (Focus Newsletter May 19). They distributed $1 to drivers who had all occupants buckled up. Those riding unrestrained received educational materials about the effectiveness of seat belts and child safety seats in saving lives and reducing injuries. The group gave out a combined $466 to motorists wearing seat belts. The credit union attached information about the credit union to the dollar bills. Agencies involved included the Prince George's Highway Safety Office and the Maryland National Capital Park Police-Prince George's County. (Photo provided by Maryland and District of Columbia Credit Union Association) … * INDIANAPOLIS (5/21/08)--Charles Carr Comptom, a former executive with the international operations of CUNA Mutual Insurance Society in Madison, Wis., died May 17 in Indianapolis. He was 88. Compton worked in 59 countries with various international organizations. He was on the faculty of what was then called CUNA School for Credit Union Personnel at the University of Wisconsin. He is survived by his wife Shirley, two children and four grandchildren. Services were held Tuesday (Indianapolis Star May 18) …

38 people arrested in phishing ring that targeted CUs banks

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WASHINGTON (5/21/08)--The U.S. Department of Justice charged 38 people in the U.S. and Romania in two separate indictments involving computer and credit card fraud with accounts at U.S. credit unions and banks. The alleged fraud involves charges of phishing--using e-mail to solicit personal information for illegal use--and smishing--using text messages to solicit personal information for illegal use (CMP TechWeb May 19). The ring allegedly procured credit card numbers and personal information that were stolen by “cashiers” through spamming phishing and smishing messages. The ring was linked to accounts at about 20 credit unions and 10 banks, but authorities said it targeted thousands of accounts from hundreds of financial institutions. The cashiers used hardware credit card encoding devices and software to imprint stolen card numbers onto magnetic strips of credit and debit cards, according to Deputy Attorney General Mark R. Filip. “Runners” then took the newly created cards and made unauthorized withdrawals. The amount stolen is estimated to be several million dollars, Filip said.

Mississippi league to launch first CU awareness blitz

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BILOXI, Miss. (5/21/08)--A “Statewide Cooperative Credit Union Awareness Campaign” will be undertaken sometime soon by the Mississippi Credit Union Association (MCUA). With the help of the Credit Union National Association, the (MCUA) conducted a credit union public awareness telephone survey in December 2007. “Mississippi found, like many other states that have conducted similar surveys, a credit union awareness campaign could benefit the state,” Amy Manley, MCUA corporate relations manager, told News Now. “Our focus at this time is the organization of a task force for recommendations and advice. Once formed, it will be the task force’s charge to represent and guide our state’s credit unions through this important endeavor,” she said. The purpose of the multi-year campaign may vary from year to year, but in the first year the goal will be to raise credit union awareness and awareness of the credit union difference, said Charles Elliott, MCUA president/CEO. “This is something that the association has talked about for many years,” Elliott said. “We intend to use several forms of media--TV, radio, print and billboards. The mix and utilization will be determined by our task force once it is formed. There is no set time frame for the campaign at this point.”

Largest CU in Poland visits CCUL

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RANCHO CUCAMONGA, Calif. (5/21/08)--Polish credit union officials, media, and the president of Poland’s largest credit union, recently spent a day at the California Credit Union League learning how credit unions operate in the U.S.
Click to view larger imageA 20-member delegation of Polish credit union officials, media and the president of Poland’s largest credit union recently spent a day at the California Credit Union League’s headquarters learning how credit unions operate in the U.S. (Photo provided by the California Credit Union League)
The 20-member delegation listened to presentations by league staff on the credit union mission and principles, social and economic role of credit unions, credit unions’ position on U.S. and California financial markets, role of the league and other apex organizations in the California credit system, and forms of state support towards credit unions. "Poland’s credit union officials were most concerned with what our credit unions are doing to help members affected by the subprime crisis,” said Sylvia Faith, league senior vice president of business services. “Apparently, Poland is experiencing its own housing downturn.” Over the last few years Polish credit unions have provided their members with 100% mortgage loans and home values have now depreciated, according to the delegation. Poland’s visit to the league coincides with the introduction of new proposals to amend the Polish cooperative law, including the Co-Operative Savings and Credit Unions Act. Journalists had the opportunity to get acquainted with the credit union system as well as the legal solutions applied in the U.S. Polish officials mentioned that it’s crucial for their media to understand the credit union philosophy. Credit unions in Poland face the same arguments from banks that credit unions do in the U.S. “The California credit union system can be proud of its successes and I’m happy we were able to show this to Poland’s journalists,” said Grzegorz Bierecki, president, National Association of Cooperative Savings and Credit Unions in Poland. “This experience will help them to understand what role credit unions can play in Poland.” Poland is the third country in recent weeks to send credit union officials to Southern California. The league hosted a Chinese rural credit cooperative delegation May 9, and in April, officials from India met with league staff and toured two Los Angeles-area credit unions.

Biz Journal Maryland CUs avoid mortgage meltdown

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COLUMBIA, Md. (5/21/08)--Maryland credit unions have managed to avoid the U.S. mortgage meltdown, and several have even increased their earnings in 2007 and piqued member interest in mortgages, according to a May 9 article in the Baltimore Business Journal. “Many of Maryland’s credit unions made gains last year, even in the difficult economy, steering clear of the subprime mortgage struggles that ensnared some banks,” the article said. “But while credit unions found a clear path through the mess in 2007, some are preparing for a tougher 2008.” (Focus newsletter, May 19). The 2007 successes of Destinations CU, Baltimore; Atlantic Financial FCU, Hunt Valley; and Municipal Employees CU, Baltimore, were cited in the article. It also mentions the earnings being used for loan interest rebates and increased dividends. “The nature of the credit union business insulated it from the subprime mortgage loans and investments that weighed on the banking world,” Mike Beall, CEO, Maryland and District of Columbia Credit Union Association, said in the article. “Now that many banks have scaled back mortgage lending, some credit unions are seeing an increase in mortgage demand.”

CUNA CFO Council exec committee named

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MADISON, Wis. (5/21/08)--The new executive committee and officers for the CUNA Chief Financial Officers (CFO) Council were announced during the council’s 14th annual conference and roundtable, which ends today in Fort Myers, Fla. The conference began on Sunday. Erin Mendez, senior vice president of finance and information technology, SchoolsFirst FCU, Santa Ana, Calif., was elected to a second term as chair. Pamela S. Finch, vice president of administration/CFO, Mid Minnesota FCU, Brainerd, Minn., remains as vice chair. Peg Lamb, CFO, CapCom CU, Lansing, Mich., was appointed secretary/treasurer. Recently re-elected to the executive committee, each for a three-year term, were Dan Leclerc, CFO, Lacamas Community CU, Camas, Wash., and Steve Smith, CFO, Sharonview FCU, Fort Mill, S.C. The committee is rounded out by:
* Louis (Jay) Scungio, vice president of finance/CFO, Freedom CU, Springfield, Mass.; * M.J. Coon, senior vice president/CFO, Ent FCU, Colorado Springs, Colo.; * Robert Warren Jr., senior vice president/CFO, Virginia CU, Richmond, Va.; and * Kevin Brueseke, chief operating officer/CFO, Missouri Credit Union Association.

Teachers legacy The model for student-run CUs

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DENVER (5/21/08)--When Kent Denver School math teacher Donna Duvall-Serrano retires on Friday, she will have left behind a hefty financial literacy legacy that will continue through students she has taught and the student-run credit union, Kent Denver Student CU, she organized 24 years ago.
Math teacher Donna Duvall-Serrano, left, will retire Friday after 24 years leading one of the nation's first--and largest--student-run credit unions, Kent Denver Student CU, a partner of Westerra CU. With her are Westerra President/CEO C. Alan Peppers, and Tracy Wittmer, who will succeed her as branch manager. (Photo provided by Westerra CU)
In 1984, Duvall-Serrano was instrumental in establishing one of the nation's first student-run credit unions, Lowry FCU, which became the nation's largest student-run credit union. The credit union also was called Gateway CU. Today, as Kent Denver Student CU, it is a branch of Westerra CU, a $923.6 million asset credit union in Denver. It has $2 million in assets. "Donna's dedication and commitment to financial literacy and her students are nationally renowned," said C. Alan Peppers, president/CEO of Westerra. "The Kent Denver CU is the model for student-run credit unions across the country. What Donna and the students have accomplished is truly amazing." Students apply for about 20 positions each year to operate the credit union, helping other students learn financial responsibility. Each year a senior is selected president, supported by officers and teller staff who operate the credit union during lunch hours every school day. It offers Kent's 655 students (sixth through 12th graders) everything, from their first checking account and first credit card to savings accounts and spending money--and in many cases, their first job. To ensure that the credit union's success continues, Duvall-Serrano has been working with Tracy Wittmer, who will succeed her as branch manager.

Filene i3 innovations move toward implementation

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MADISON, Wis. (5/20/08)--Eight new projects by the Filene Research Institute's i3 innovations group were highlighted at Filene's Cherry Blossom Gathering of credit union executives recently at the Kennedy Center for the Performing Arts in Washington, D.C. The eight presentations likely will become part of credit union operations before long, said Filene in a press release. The projects include:
* Single Again. The project targets newly divorced or widowed credit union members and their needs regarding loan modifications. Team spokesman Mike Fletcher, vice president of marketing and development at Portland-based West CU, said the project can fill a void while strengthening the relationship between member and the credit union. * First Step Program. The First Step Program is designed to assist members with their dreams and to get them one step closer to financial freedom. It targets people who are underserved by banks and who gravitate toward check cashers and payday lenders. * The Big Idea. The project also helps members "turn dreams into reality" with small business ownership. People nearing retirement age are starting their own businesses. The Big Idea would provide a business readiness tool to help members get their idea off to a good start. * Unite. Team spokesmen Steve Koenen of Altra FCU and Charlie White of Members United Corporate FCU describe United as a relationship-pricing program allowing a group of members to benefit from the collective value of participating in specific credit union products and services. The "friends and family" type of program is designed to change behavior in product usage and to help generate new memberships, retain existing ones and generate credit union advocates in the community. * Sandwich Generation. The project focuses on providing online educational resources for members caring for aging parents while supporting children or grandchildren. * Focus on Thrift--Collaboration in the Classroom. Credit unions would pool resources to hire a representative to visit schools on their behalf and to develop an online class. * Airport Oasis Lounge. This would be a designated airport luxury space for credit union members. * Choice Endings. The program would provide members with funeral planning assistance.
Filene Executive Director Mark Meyer said "every one of these ideas reflects a very real demand among credit union members." i3 can contribute potential solutions to credit unions to meet those demands, Meyer added.

CU System briefs (05/19/2008)

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* ASHEVILLE, N.C. (5/20/08)--North Carolina Gov. Mike Easley has appointed K. Ray Bailey, president emeritus of Asheville-Buncombe Technical Community College, to a seat on the North Carolina Credit Union Commission (Citizen-Times.com May 17). Bailey was appointed to a four-year term, representing the western region of the state. The seven-member commission works with the Credit Union Division in the state Department of Commerce. It holds semi-annual meetings to discuss statistics, training and legislative initiatives … * WASHINGTON (5/20/08)--Credit unions have until June 17 to nominate their candidates for the Herb Wegner Memorial Awards, credit unions' highest national honor. Awards are presented for individual achievement, outstanding organization/program and lifetime achievement. To make a nomination or for more information, go to National Credit Union Foundation site … * PALO ALTO, Calif. (5/20/08)--Addison Avenue FCU has received Fannie Mae's Prime Alliance Credit Union Lender of the Year award for 2007. The award was announced at the annual Prime Alliance Symposium on May 6. Criteria reviewed included community outreach, increased loan originations and improved processing efficiencies in the mortgage department. In 2007, the credit union generated more than 990 mortgages totaling more than $300 million. Of these, more than 475 loans (totaling more than $106 million)were sold to Fannie Mae. The loans are a 129% increase over 2006 (through October) and a 140% increase of Purchase Money Mortgages (mortgages sold to Fannie Mae). Of the Purchase Money Mortgages, 14% were in areas considered underserved by Fannie Mae. That beat Addison Avenue's goal of 10%. The award winner is chosen from a national pool of credit unions … * PHOENIX (5/20/08)--Ron Amstutz, senior vice president of Phoenix-based Desert Schools FCU, received the prestigious Credit Unions for Kids Miracle Maker Award from the Children's Miracle Network (CMN) at a recent ceremony in Orlando, Fla. Amstutz was the driving force behind major fundraising efforts for Phoenix Children's Hospital's "1 Darn Cool School," an on-site classroom facility for long-term patients. Desert Schools is the top credit union in the U.S. for funds raised for CMN--with more than $1.5 million collected since 1998. In 2007, members, employees and sponsors contributed $340,000 to the hospital …

Groundbreakings of Homes for Our Troops on video

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WASHINGTON (5/20/08)--Videos of the groundbreakings of two homes in the "Homes for Our Troops" project involving credit unions is available on the Credit Union National Association's (CUNA) website. CUNA, along with the National Journal Group and the Republican and Democratic National Conventions, are jointly sponsoring homes for two disabled U.S. servicemen wounded in the line of duty. Credit unions will build the homes for Army Sgt. Marcus Kuboy in St. Paul, Minn., site of the Republican convention, and Staff Sgt. Travis Strong in Golden, Colo., near the Denver site of the Democratic convention. At each national convention, America's Credit Unions look for opportunities to give back to the host cities. Homes for Our Troops is a nonprofit organization that builds specially adapted homes for severely injured service members. For more information, use the link.

WOCCU tour helps Chinese co-ops study CU difference

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RANCHO CUCAMONGA, Calif. (5/20/08)--A 10-member contingent from China's rural credit cooperative (RCC) and regulatory systems visited California credit unions and their trade association last week. The trip, arranged by the World Council of Credit Unions (WOCCU), was arranged to help the visitors better understand credit unions' role among U.S. financial service providers.
Click to view larger imageFrom left, front: Brian Branch, World Council of Credit Unions executive vice president/chief operating officer; Zhang Gouze, officer, China banking Regulatory Commission; Barry Jolette, San Mateo CU CEO and WOCCU first vice chairman; Wange Liming, Guizhou Provincial Rural Credit Cooperative Union; O'Rourke, Sue Mitchell, Mitchell & Associates partner; and Chinese regulator Jiang Min. In back, Guizhou Provincial's Zue Wen, Wu Yong and Suo Mieying; WOCCU program specialist Andrea Dannenberg; Financial Service Centers Cooperative President/CEO Sarah Canepa Bang; interpreter Amy Yin; and Guizhou Provincial's Ma Hong, Jiang Li, Zhou Qiling and Gong Ziaohgang. (Photo provided by the World Council of Credit Unions)
Eight managers and directors from China's Guizhou Provincial Rural Credit Cooperative Union and two managers from the Guizhou branch of the Chinese Banking Regulatory Commission met with California credit union and league executives to study competitive advantages, particularly those due to “the credit union difference.“ “This was a meeting of complementary approaches, with each group learning from the other," said Brian Branch, WOCCU's executive vice president and chief operating officer, who led the five-day visit. “WOCCU is committed to continuing to help the Chinese RCCs adapt credit union principles and systems to provide access to financial services to China's rural communities.“ The group visited the California Credit Union League, WesCorp FCU and San Mateo CU in Redwood City, Calif., to learn how the U.S. credit union system is organized and the benefits members receive over bank customers. The group sought tools and techniques applicable to China's RCCs. The visitors included Jiang Min and Zhang Guoze from the Guizhou office of the China Banking Regulatory Commission. The Guizhou Provincial Rural Credit Cooperative Union was represented by Gong Xiaogang, Jiang Li, Ma Hong, Suo Meiying, Wang Liming, Wu Yong, Xue Wen and Zhao Qiling. China's rural credit cooperatives and rural cooperative banks are working to modernize their management and operational practices while trying to maintain their member focus. Participants were particularly interested in strategic planning processes and how this enables credit unions to provide better member service. The visitors expressed particular interest in San Mateo CU's human resources management, including its performance evaluation program and compensation strategy. Participants described the transition of RCCs, which serve 200 million households on mainland China, as moving from social, mission-driven entities operating largely as charities to market-driven financial institutions with a social mission. The Chinese regulators explained the role of the provincial central organizations as one of setting uniform systems and standards from the top down. This approach provides for greater efficiency and consistency, they said, but the challenge then becomes how to provide better service to members at the credit union level. “This meeting was another in a series of efforts by WOCCU to share experiences as financial cooperatives and measure how those experiences might be applied to RCCs in China," said Barry Jolette, CEO of San Mateo CU and WOCCU first vice chairman. “This ultimately will lead to a partnership between RCCs and California credit unions.“

Maine league awards honor those who give back

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WESTBROOK, Maine (5/20/08)--The Maine Credit Union League recently
Robert “Bob” Leathers (left), volunteer, Eastmill FCU, with Dan Byron, Eastmill president/CEO.
honored six individuals as the recipients of the Maine credit union movement’s annual awards. The recipients were honored at a special ceremony held in Portland in early May in conjunction with the League’s 70th Annual Meeting and Convention. Nominees are submitted by credit unions, with the final winners determined by the league’s Awards and Convention Committee. Here are the 2008 league award winners:
* Alexander Ferguson Award for Outstanding Credit Union Volunteer--Robert (Bob)
From left: David Rossignol, president/CEO, Norstate FCU, and Ray Marquis, Norstate board chair.
Leathers of Eastmill FCU, East Millinocket, has served on the credit union’s board for nearly 30 years, including the position of board chair for more than 20 years. Leathers also serves as chairman of the East Millinocket School Committee, the Knights of Columbus board and several church committees. * James M. Gratto Award for Outstanding Credit Union Manager--David Rossignol, president/CEO of NorState FCU, Madawaska, was recognized as a leader, motivator and mentor for his staff. Rossignol has been with the credit union
Midcoast FCU’s Colleen McGuiggan (left) with President/CEO Gail Richardson.
for more than a decade and is also active in his community, serving on a number of committees and civic organizations. He is also a member of the league’s board, representing the Aroostook Chapter of Credit Unions. * Jeannette G. Morin Award for Outstanding Credit Union Employee--Colleen McGuiggan, human resources manager and staff supervisor at Midcoast FCU, based in Bath, has worked at the credit union for 20 years. She began as a teller and has held numerous positions. She is involved in fundraising efforts at the credit union, including the Maine Credit Unions’ Campaign for Ending Hunger and Special Olympics. *
Maine league President John Murphy, right, and Sid Wilder, president/CEO, Taconnet FCU.
League President’s Award for Outstanding League Volunteer--Sid Wilder, president/CEO of Taconnet FCU in Winslow, has worked for 37 years in the Maine credit union movement and will retire this fall. He has been an active participant in the movement, serving on committees, boards and as a member of the league’s Governmental Affairs Committee for the past 10 years. Wilder was recognized by league President John Murphy for “always being willing to get involved and who is a true example of the credit union spirit of cooperation and collaboration.” *
Maine State CU’s Christina Carter, left, with President/CEO Normand Dubreuil.
Diane L. Oceretko “People Helping People” Award--Christina Carter, of Maine State CU in Augusta was recognized as a person hasn’t just talked about “people helping people,” she has done it. In her four years as a member of the credit union’s social responsibility committee, her enthusiasm has pushed her credit union to the No. 1 spot in dollars raised for the past two years for Maine Credit Union’s Campaign for Ending Hunger. Carter also devotes her energy and creativity to many other causes including serving on her local town’s PTA, volunteering in her children’s classrooms every week. *
Tucker Cole (left), president/CEO, Evergreen CU, Portland, and Maine league’s Governmental Affairs Committee chair, with Luke Labbe, president/CEO, People’s Choice CU. (Photos provided by the Maine Credit Union League)
Governmental Affairs Committee Chairman’s Award--Luke Labbe, president/CEO of PeoplesChoice CU, Biddeford, was honored for leading by example on the importance of being active in grassroots and political activities. Labbe was recognized for pioneering a new event to raise funds for political advocacy. In five years, it has become the largest, one-day fundraiser for CULAC. As a result of this event, the league has not only been able to increase the amount of funds raised for CULAC, but raised awareness, as well. Tucker Cole, president/CEO, Evergreen CU, Portland, and the league's Governmental Affairs Committee chair, presented the award.

Illinois Legislative Day focuses on CU Act updates

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NAPERVILLE, Ill. (5/20/08)--A record 130 credit union advocates focused on legislative issues such as updates to the Illinois Credit Union Act during the Illinois Credit Union League's annual Legislative Day recently. The updates bill, H.B. 4461, passed the state House during the day's events. The bill would authorize state-chartered credit unions to:
* Use Generally Accepted Accounting Principles (GAAP) for loan loss accounting, subject to an external auditor determination that the time period is in accordance with GAAP; * Provide these limited services for people eligible for membership but who aren't members of the credit union: issuance of negotiable checks (including traveler's checks), money orders and similar money transfer instruments, including electronic fund transfers; and the ability to cash checks and money orders, and receive electronic fund transfers for a fee; * Participate in the no-down-payment Housing and Community Facilities Programs established by the U.S. Department of Agriculture.
Robert Meza, recently appointed as the new director of the Illinois Division of Financial Institutions, addressed attendees at the Illinois Credit Union League's annual Legislative Day recently. (Photo provided by the Illinois Credit Union League)
At the Legislative Day event, Paul LaVota, Missouri state representative and lecturer on advocacy, spoke about "How to speak so politicians will listen." He presented a similar session at ICUL's chapter legislative forum representatives at a dialogue session prior to the conference. Recently confirmed director of the Illinois Division of Financial Institutions Robert Meza took the opportunity to introduce himself to participants. He also spoke at ICUL's annual convention last month. League lobbyist Richard Lockhart, founder of Social Engineering Associates, was honored for 50 years of service on the floor of the Illinois General Assembly via H.R. 1021 on April 2 and with a resolution by the ICUL board on March 13. Lockhart has represented the league for 32 years and was instrumental in forming the Credit Union Political Action Council in 1976 and structuring Illinois credit unions' grassroots lobbying system. He also assisted with the recodification of the Illinois Credit Union Act in 1979 and field-of-membership expansion legislation for community chartered credit unions in 1985. More than 60 lawmakers from both sides of the aisle and other dignitaries attended the event's legislative reception. The Illinois General Assembly is scheduled to conclude its Spring legislative session on May 29.

CU in New Hampshire reports missing data disk

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MANCHESTER, N. H. (5/20/08)--A disk containing the personal information of about 3,000 members of Bellwether Community CU (BCCU) was reported lost on April 28 by the credit union, which is taking measures to ease members’ concerns about identity theft. “Although we feel the likelihood of the risk of this information being compromised is very low, we wanted to be able to provide our members tangible comfort,” Claire Castanino, BCCU executive vice president/chief operating officer, told News Now. “We did this by conducting extensive internal training with BCCU personnel to answer questions and give guidance; we authorized heightened alerts on our credit card system and credit union accounts; and we offered one year of identity theft protection and insurance free to all affected members," Castanino added. The $283.9 million asset, Manchester, N.J.-based credit union’s CEO, Michael L’Ecuyer, sent a letter to members last week apologizing for the incident (New Hampshire Union Leader May 17). “Recently, we discovered that a disk containing personal information was not immediately stored in its customary locked and secure location, and its current status cannot be verified,” L’Ecuyer wrote. "We have no evidence of theft of this disk and believe the likelihood of the risk being compromised is very low. The disk contained information such as names, address, Social Security numbers, birth date, Visa account information and in some cases, BCCU account numbers,” the CEO said. There was no indication of criminal activity. Rather it is believed the disk had been misfiled or accidentally thrown way, Castanino said. However, members should keep a close eye on their accounts and statements, given the nature of the situation, Castanino added.

Regulator Loan types a factor in Wis. CUs first quarter

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MILWAUKEE, Wis. (5/20/08)--The type of lending typically conducted by Wisconsin credit unions makes them less susceptible to the loan problems facing the state's banks, according to Wisconsin's credit union regulator. Earnings for Wisconsin's credit unions during first quarter increased almost 20%, according to a state report (Milwaukee Journal Sentinel May 15). Credit unions' net income for the quarter ending March 31 totaled more than $28.1 million, up from $23.5 million for the first quarter 2007. Suzanne T. Cowan, director of the Wisconsin Office of Credit Unions, told the Journal Sentinel that banks have been hurt by loans to home developers who ran into trouble when the housing slump hit. Much of credit unions' lending is concentrated in first mortgages and auto loans, she said. Because credit unions are smaller, they have more conservative loans. The two largest banks in the state saw earnings drop--a 33% decline at Marshall & Ilsley, located in Milwaukee, and a 9.4% decline at Associated Banc-Cop in Green Bay.

Ohio payday lenders close CUs touted as alternatives

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SPRINGFIELD, Ohio (5/20/08)--Credit unions received positive attention from the Ohio Coalition for Responsible Lending as a place that Ohio's consumers can turn to for alternative loans as payday lenders leave the state. The Springfield News Sun (May 16) reported that Cash America, which operates Cashland and Cash America Payday Advance, said it would close nearly all its Ohio stores in response to state legislation regulating interest rates and other payday lending practices. Tom Allio, chairman of the coalition, discussed the pending legislation, which would create a program to offer incentives for nonprofits and banks to make small loans. He told the newspaper that consumers can turn to credit unions for a "much more affordable product." The story highlighted payday alternative loans from International Harvester Employee CU, Springfield, and Wright Patt CU, Fairborn. For the full article, use the link

IAmericas Most WantedI re-enacts CU robbery

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PHOENIX (5/20/08)--The TV show, America’s Most Wanted, aired a re-enactment Saturday of two kidnapping and robbery attempts--one of which took place in October at Desert Schools FCU, Phoenix. The first attempt was thwarted when three thieves realized that the loan officer at the $3.019 billion asset credit union did not have access to the credit union’s vault (The Arizona Republic May 16). The trio--armed with semiautomatic handguns and perhaps assault weapons--had kept the employee’s spouse and child hostage, restrained in disposable nylon restraints. In a second incident, the same thieves kept a Chandler, Ariz., bank manager and wife hostage in his home for 12 hours, and drove the manager to his Wells Fargo branch, where three employees were taken hostage while the thieves emptied the safe. The TV episode will feature a sketch of a possible suspect who bought a pair of handcuffs and shackles at a Mesa, Ariz., store days before the heist.

Community Trust outlines 75 years of the CU difference

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GURNEE, Ill. (5/19/08)--A lot has changed at Community Trust CU in the past 75 years; yet, much remains the same, especially the philosophy, according to an article in The News Sun (April 29). The newspaper interviewed President/CEO Madeline Lipka, who outlined the credit union difference throughout the history of the credit union, which was founded as Warren Township CU. Today it has more than $161 million assets. Lipka told the newspaper the credit union was formed to create a comfortable environment where people could find an alterative to the high-interest loans and low-yield savings offered by local banks. "That's still our biggest draw three-quarters of a century later," she said. Many people don't realize credit unions offer high-tech, secured financial services, she said. The biggest difference (from banks) is that we treat our members like they own the place, because they do." She noted the member-owned, not-for-profit financial cooperative structure and pointed out the credit union and its employees are heavily involved with community service groups. "Everything we do, and each of the products and services that we offer, begins with the realizations that our members want to enjoy a comfortable lifestyle, followed by a prosperous retirement. The communities and families we serve are the reason for our continued success, so we make them our top priority."

Online banking beats branches call centers

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NEW YORK (5/19/08)--Customer satisfaction with online banking sites has risen significantly the past five years, indicating that Americans are more pleased with online banking operations than with branches and call centers, according to a study. The 2008 ForeSee Results/Forbes.com Online Financial Services Study employs the University of Michigan's American Customer Satisfaction Index (ACSI). The study measures customer satisfaction with the online experience in three areas: Banks (defined as large banks, regional banks and credit unions), credit card companies, and investment services firms. Online banking websites scored 82 on ACSI's 100-point scale, up 12% or nine points from 73 in 2003. Credit card websites and investment websites each scored 75. Overall retail banking scored 78 when measured by ACSI last year. Three factors were cited in the study as why banking sites had higher customer satisfaction levels. They have made it easy for customers to access information and conduct transactions at their convenience; they have convinced large numbers of customers of the convenience, value and security of the online channel; and they know to use the web as a tool to build stronger customer relationships. The survey found that highly satisfied online banking customers are significantly more likely to purchase more services (31%), use the website as a primary channel (57%) and recommend their financial institution (54%) as its website (63%). The survey report noted several opportunities for financial institutions to raise customers' satisfaction and loyalty. They can: increase online bill payment; increase Web usage; increase online applications for loans and other activities; and increase use of online customer service features, such as demos and tutorials.

Stimulus checks can impact CUs bottom line

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FARMERS BRANCH, Texas (5/19/08)--The federal government’s efforts to boost the slumping economy through economic stimulus checks could result in a torrent of cash hitting credit unions. How should credit unions respond? About 130 million Americans will receive checks, ranging in size from $600 to $1,800. Preliminary surveys indicate that only 20%-25% of recipients will spend their checks, while the remainder will deposit the checks to bolster their savings balance or pay down debt--meaning credit unions could be awash in cash (LoneStar Leaguer May 16). Such large inflows of cash are the kind of anomaly that can negatively impact a credit union’s bottom line if the credit union has not been vigilant in adjusting interest rates relative to earnings, said analysts from Southwest Corporate Investment Services Asset/Liability Management (ALM) Service. “If credit union capital is low and investment earnings are renewing at rates lower than those being paid on member dividends, large cash inflows will only exacerbate the move toward negative earnings,” Mark DeBree, senior ALM analyst, told the Texas Credit Union League. “Credit unions should determine whether dividend schedules are reasonable, based on earnings in the current interest rate environment,” he added. “Some credit unions are reticent to cut the cost of funds because they want to provide the greatest value for their members. But maintaining share rates that are too high can result in negative earnings and jeopardize the credit union’s financial condition. “While credit unions can’t ignore what competitors are paying on deposits, it should not be the sole determinant in setting deposit rates,” DeBrees concluded.

Michigan St. Lucia leagues sign partnership

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GRAND RAPIDS, Mich. (5/19/08)--The Michigan Credit Union League (MCUL) and the St. Lucia Credit Union Co-operative League made their international partnership official at a signing ceremony in Grand Rapids, Mich., Thursday. The World Council of Credit Unions (WOCCU), which now oversees 29 such partnerships, including St. Lucia/Michigan, in its International Partnerships Program, was also represented at the ceremony.
Pictured at the signing of an World Council of Credit Unions (WOCCU) international partnership agreement between the Michigan Credit Union League (MCUL) and the St. Lucia Co-operative League are, from left: Alan Babcock, MCUL vice president of credit union relations; Catherine Roberts, WOCCU board secretary and CEO of Community Choice CU, Livonia, Mich.; David Adams, MCUL president/CEO; Victor Miguel Corro, WOCCU international partnerships manager; Alexander Joseph, CEO, St. Lucia Co-operative League; Emmerlyn Monrose, manager, St. Lucia Civil Service CU; and Rupert Branford, director of Elks CU and of the St. Lucia Co-operative League. (Photo provided by the World Council of Credit Unions)
The signing ceremony took place during the MCUL’s 2008 Annual Convention and Exposition. Attending from St. Lucia were Emmerlyn Monrose, manager of St. Lucia Civil Service CU; Rupert Branford, director of Elks CU and of the St. Lucia Co-operative League; and Alexander Joseph, CEO of the St. Lucia league. “We are very happy and appreciative that the WOCCU and the MCUL have effectively started a partnership with St. Lucia, a developing credit union movement with lots of room to grow,” Joseph said. “The MCUL and credit unions have expressed a keen interest in getting to know other movements and cultures, which demonstrates the cooperative spirit of our movement. We look forward to making key achievements,” he said. “We would like the credit unions in St. Lucia to see how mergers work and study their advantages and disadvantages,” said Victor Miguel Corro, International Partnerships manager for WOCCU. “We’d also like them to better understand marketing strategies that will help them attract new members and satisfy the needs of the members with sophisticated, updated and relevant credit union products and services.” "Strengthening the credit union system worldwide is a vital effort for the future of the industry, and the St. Lucia partnership is an excellent opportunity to help do this,” said David Adams, MCUL president/CEO. The partnership will help support WOCCU’s technical assistance project in St. Lucia, designed to shore up the country’s credit unions so they can provide stronger support to the island’s farmers. Many of the farmers lack the resources to grow produce, primarily bananas, to sell to the luxury hotels that are part of the island’s growing tourist industry. WOCCU plans to ask MCUL for assistance in conducting market studies to determine the quality and capabilities of St. Lucia credit unions’ agricultural lending programs to support those efforts, said Matt Garcia, a WOCCU program manager. “Helping island farmers become self sufficient is vital to their survival in a rapidly changing island economy,” Garcia said. “Thanks to the Michigan league’s generous involvement, we’ll be better able to accomplish that goal.” Two MCUL staff members visited St. Lucia in November 2007 to conduct a needs assessment and familiarize themselves with the people and culture. An island nation approximately 28 miles long and 13 miles wide, St. Lucia is home to 15 credit unions. Approximately 150,000 people call St. Lucia their full-time home, with one-third of the population belonging to a credit union.

CUs not hurting banks says letter to the editor

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BATON ROUGE, La. (5/19/08)--Credit unions are not hurting banks, according to a credit union CEO’s letter to the editor published in the Baton Rouge Advocate this month. A 2006 study by the Government Accountability Office (GAO) indicated that banks are not harmed by credit union competition, wrote Cary J. Anderson, president/CEO of LA DOTD FCU in Denham Springs, La. The study, which was conducted from 1996 to 2006, said banks had a net income growth rate of 7%, compared with credit unions’ net income growth rate of 3% (Baton Rouge Advocate May 5). Banks reported a net income of $146 billion in 2006, compared with credit unions’ net income of $6 billion, the letter said. The study also said that banks use tax deductions, and 31% of banks are Subchapter S corporations. Subchapter S corporations pay no tax by providing income to shareholders, who then are taxed individually. Some banks have used tax shelters and transactions the Internal Revenue Service deems abusive, Anderson wrote. Credit unions are chartered to serve people of modest means, and provide members with higher dividends, lower loan rates, lower fees and in the case of LA DOTD FCU, a cooperative network in 3,200 locations with thousands of surcharge-free ATMs, Anderson noted. Credit unions are tax-exempt because of their charter, and pass along savings to members. Credit unions also provide members with financial education. LA DOTD FCU sponsors three in-school credit union branches and provides a certified financial literacy teacher to schools for free, the letter said.

Are credit union robberies getting more violent

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MADISON, Wis. (5/19/08)--Are credit union robberies becoming more violent? That is difficult to answer, because robberies by nature are violent; the threat of violence is always there, according to a CUNA Mutual robbery expert. The trend over the past few years with the use of weapons in credit union robberies is staying consistent, Vince Wagner, risk manager for CUNA Mutual Group, told News Now. In 2006, 434 credit union robberies were reported to CUNA Mutual Group, with 246 (57%) involving a weapon, Wagner said. In 2007, 349 robberies were reported, with 179 (51%) involving a weapon. “But based on media reports, it appears that perhaps weapons are being used more now, as opposed to just being displayed,” he said, adding that CUNA Mutual doesn’t make that distinction in the statistics it keeps. “I want to emphasize that credit unions need to be cognizant of the possibilities of robbery and provide their staffs with training,” Wagner said. “The key thing to remember during a robbery is cooperate, cooperate, cooperate. Don’t panic, remain calm, and get the robber out of the credit union as quickly as possible, because then there is less likelihood something will go wrong,” he concluded. Some incidents of violence with credit union robberies in the past year:
* An armed man lined up eight credit union employees and one member in Fibre FCU, Longview, Wash., and pepper sprayed them all, then fled with a bag of cash Tuesday afternoon (Associated Press May 14). * An armed man entered Keesler FCU, Biloxi, Miss., and took two employees hostage, Tammy Brister, vice president of branch operations, told News Now (April 22). The man had several weapons, and the credit union was "extremely busy" at the time of the robbery, she added. Because he came to the credit union on foot, he forced the tellers into a car to escape. The three left the credit union, and after a high-speed chase, the car drove into a ditch and the robber was caught by police, Brister said. "The tellers are fine," she said. "No one was hurt physically." * A teller of a Charlotte, N.C., branch of Raleigh-based State Employees CU' was shot and seriously injured during a robbery in March (Charlotte Observer April 1). * A suspect involved with an attempted armed robbery and shootout at the Niles, Mich., branch of Berrien Teachers CU died in surgery at a local hospital in January. The suspect was allegedly shot during the attempted robbery the morning of Jan. 18 by a security guard. Two men entered the credit union and exchanged gunfire, both inside and outside of the credit union, with the guard. At least five shots were fired, police told the Tribune (Jan. 22).
Some other violent incidents at credit unions, not involving robberies:
* A Concord, N.H., police officer was shot inside an under-construction branch of Granite State CU in May when another officer's gun discharged. The officer was treated and released from a local hospital. "We're glad nobody was seriously injured," Denise Caristi, president/CEO, Granite State CU, told News Now (May 5). * A Maine man who waved a chain saw over his head, revved it up to threaten passing motorists, and performed impromptu pruning of local shrubbery was eventually arrested at gunpoint near Howland Enfield CU. A local deputy sheriff and a Maine State Police Trooper took Lionel Dube, Jr., of Argyle, into custody. He was charged with criminal threatening, disorderly conduct and violation of bail conditions (Associated Press June 7).

IVermont WomanI article on CUs draws readers response

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BURLINGTON, Vt. (5/19/08)--An article published in a women’s newspaper about the benefits of joining a credit union garnered positive feedback from readers, according to the Association of Vermont Credit Unions. The article, “Explore the Benefits of Joining a Credit Union,” written by Financial Coach and Speaker C.D. Moriarty, was published in the May issue of Vermont Woman. The article drew a lot of interest from readers, according to Ellen Biddle, account executive at the newspaper. She told the association that many comments the newspaper received “echoed the sentiments expressed in the piece...that credit unions are locally owned, member-controlled and highly beneficial alternatives to large commercial banks, which answer to stockholders” (Newsline Express May 16). A number of credit union staff and members were quoted in the piece, including Association President Joe Bergeron. “On average, Vermont credit union members receive $240 in benefits a year,” he told Moriarty. Sue Leonard, New England FCU, Williston, Vt.; Ginny Fleischman, Green Mountain CU, South Burlington, Vt.; and Mary Robert, Vermont FCU, Burlington, also are quoted. Robert, 35, joined the credit union when she was 16. The article also profiled credit union pioneers Dora Maxwell, Louise Herring, and Angela Melville, addressing the role that women have played in the credit union movement. Maxwell was an avid organizer for the credit union movement’s trade association as well as an original signer of the Credit Union National Association’s constitution. Herring signed the original constitution for the national credit union association when she was the Ohio delegate to the 1934 national credit union conference in Estes Park, Colo. Melville helped farmers, coal miners and other laborers organize credit unions in Kentucky. She rode horseback across 20 states, encouraging communities to start credit unions.

25 grants total 10900 for flood relief in Maine

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WASHINGTON (5/19/08)--Twenty-five members in flood-stricken northern Maine will receive a combined total of $10,900 in flood relief checks from credit unions. "The National Credit Union Foundation (NCUF) commends the Maine Credit Union League and the Maine credit union community for rallying to support survivors of the worst flooding in northern Maine in over 100 years," said Steve Bosack, deputy director of NCUF. Maine credit unions and their supporters raised $13,290 through www.cuaid.coop/maine for credit union members whose homes were flooded in Aroostook County. NCUA is now moving forward to prepare disaster relief grant checks to flood victims whose needs have been classified as "critical" or "very serious" by their credit union CEO. Fifteen members of Acadia FCU with critical needs will receive a total of $7,500 in grants or $500 each. Five members of NorState FCU with critical needs will receive a total of $2,100 in grants, ranging from $100 to $500. Two members of Acadia and three members of NorState also will receive a combined total of $1,300 for members with very serious needs. NCUF will deliver the checks next week to the credit unions, who verified and prioritized their members' flood losses. More flood relief applications are in the pipeline, with more than $2,000 still available for grants in the state, said Bosack. NCUF will hold off for another week on funding for members with less serious needs. Any new "critical" or "very serious" applications coming in will take priority. Maine credit unions are still raising donations. "We hope to be able to fund all of the pending applications--and perhaps even consider larger grants to members who suffered the largest unrecoverable losses," he said. For more information on the flood and relief measures, use the resource link.

Irish CUs mark 50 years of growth influence

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DUBLIN (5/16/08)--The growth in size and influence of the Irish credit union movement during the past five decades stands in testimony to the abilities of its executives and dedication of its members. That was the message conveyed by World Council of Credit Unions (WOCCU) Chairman Melvin Edwards last month at the Irish League of Credit Unions' (ILCU) annual general meeting and celebration of the 50th anniversary of the Irish credit union movement. "The impressive growth and expansion of the Irish movement over the past 50 years to a membership of some three million is indeed worthy of celebration,” said Edwards, director of the Caribbean Confederation of Credit Unions. Edwards and Pete Crear, WOCCU president/CEO, joined 1,500 delegates from 365 Irish credit unions in Dublin. The tremendous efforts of those associated with the movement can take credit for the success of Ireland’s credit unions, according to ILCU President Uel Adair. The extended anniversary celebration also will include commemorate stamps in the Republic of Ireland and Northern Ireland, the launch of a country-wide marketing campaign, and the May 22 inaugural Nora Herlihy Memorial Lecture by global anti-poverty campaigner Sir Bob Geldof, who was instrumental in organizing Live Aid for famine relief in Africa. Herily ran Ireland's first credit union. The league's National Advertising Campaign aims to clarify the credit union difference for Ireland's four million population. A new Credit Union Practice Training Program, developed by ILCU in partnership with the University of Ulster contains 14 credit union-specific modules designed to increase workplace capabilities and improve service to members. “World Council's participation in these commemorative events is more than mere recognition of Ireland's immense contribution to international credit union development and to the strength of WOCCU itself,” Edwards said. “The programs also anticipate ILCU’s accelerated progress in surmounting current regulatory and other challenges and initiating the Irish movement’s next phase of strategic transformation."

TJXMasterCard data breach settlement finalized

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FRAMINGHAM, Mass. (5/16/08)--A previously announced settlement between TJX Cos.--the retailer that disclosed last year the largest data breach in history--and MasterCard International Inc. and its card issuers has been finalized, and the Credit Union National Association (CUNA) has been assisting credit unions in reviewing the settlement. Financial institutions representing 99.5% of eligible MasterCard accounts having claims from the data breach accepted the settlement's alternative recovery offer. The companies had said the final settlement would hinge on getting acceptance from at least 90% of the compromised accounts with claims by May 3. As it did with an earlier settlement in December between TJX and affected Visa account issuers, CUNA arranged a conference call with credit unions, leagues and MasterCard to review the settlement with them and responded to their questions and concerns about it. CUNA also followed provided additional information in News Now and , and staff continue to help credit unions with their subsequent questions, said Mary Dunn, CUNA senior vice president and associate general counsel. TJX funded $24 million (pre-tax) for alternative recovery payments. The costs already have been reflected in a charge that TJX took last year related to the breach. Each accepting issuer released and indemnified TJX and its acquiring banks regarding any claims by the issuers, their affiliate issuers (such as credit unions and banks) and their sponsoring issuers regarding the breach. These include any claims in the putative financial institution class actions in federal and state courts. In an earlier settlement with Visa U.S.A. and Visa card issuers, 95% of financial institutions eligible accepted the alternative recovery offer (News Now Dec. 21). Some credit unions and banks have opted not to take the settlements and have separate lawsuits pending (News Now March 26). TJX, the Framingham, Mass.-based operator of 2,595 stores including the T.J. Maxx and Marshalls discount retail stores, discovered the breach last year.

Rural co-ops working with WOCCU in China still intact

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MADISON, Wis. (5/16/08)--Rural credit cooperatives (RCCs) working with the World Council of Credit Unions (WOCCU) in China are reporting none were knocked out of commission by a massive earthquake Monday that killed at least 10,000 people. "We were working in Guizhou Province, next door to Sichuan Province, epicenter of the earthquake," said Michael Muckian, communications manager at WOCCU. "Although there are rural credit cooperatives in Sichuan, we haven't been in touch with them for quiet some time, and like the rest of the world, we don't know what's going on over there right now," Muckian told News Now. Ten people from RCCs in Guizhou are in the U.S., visiting credit unions in California. Some were apparently in touch with their families back home. The families said "they felt some shaking, but there were no injuries or deaths, no significant damage, and no RCCs knocked out of commission," he added. WOCCU's World Credit Union Conference will be in Hong Kong, nowhere near the region devastated by the 7.9 magnitude quake. The conference is set for July 13-16.

CDFIs rally to support New York State Fund

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ALBANY, N.Y. (5/16/08)--About 80 participants from all areas of the state came May 8 to Albany to highlight the work of Community Development Financial Institutions (CDFIs), and voice support for the New York State CDFI Fund at the New York Coalition of CDFIs Statewide Conference.
The New York Coalition of Community Development Financial Institutions (CDFI) steering committee includes, from left: Cliff Rosenthal, National Federation of Community Development Credit Unions president/CEO; Bob Radliff, CEO, Capital District Community Loan Fund; Leni Hochman, chief financial officer, Alternatives FCU; Donna Gambrell, director, U.S. Treasury Department CDFI Fund; Justine Zinkin, CEO, Neighborhood Trust FCU; David Raynor, executive director, Leviticus 25:23 Alternative Loan Fund; and Rafael O. Morales, Federation public affairs officer and coalition coordinator. Not pictured are: Gina Bolden-Rivera and Greg Gamble, Carver Community Development Corp., New York; Kristin Giantris, Northeast vice president, Non-profit Finance Fund, New York; and Dana Brunett and Hubert Van Tol, Rural Opportunities Inc., Rochester, NY. (Photo provided by the National Federation of Community Development Credit Unions)
The conference was organized by the National Federation of Community Development Credit Unions. Following the conference, 13 credit union leaders met in Albany to discuss the future of community development credit unions. Organized with Alternatives FCU, Ithaca, N.Y., the summit was an opportunity for affiliated credit unions in the federation’s northeast region to create a structure for future collaborations. Tristam Coffin, CEO, Alternatives FCU, approached the federation to organize the meeting because “there are so many things that are common to all credit unions, and spending less time and money doing some of those things will allow us to be much more successful,” she said. Attendees were interested in collaborating on a variety of issues, including staff training, marketing and data processing. The group determined that its goal is to “perpetuate the survival of community development credit unions through innovative collaborative solutions.” Participants included community development credit union leaders, federation staff, and the federation’s community development partner, Paragon FCU, Montvale, N.J. The group intends to continue meeting and will invite more credit unions to participate through the federation. “CDFIs are needed now more than ever amid this subprime crisis,” said federation President/CEO Cliff Rosenthal. “It’s not just about housing, the problems in the financial system have translated into a contraction of credit for all sorts of enterprises and all sorts of lending. That says to us that the diversified funding that CDFIs provide, whether it’s for housing, micro-enterprise, or small businesses, is more critical than ever.” New York State Rep. Darryl Towns and Senate Bank Committee Director Pete Edman addressed CDFI conference attendees. “Because you’re small, and lean and mean, you’re able to get products out there that are needed, without having to go through months of shareholder meetings to come up with these ideas,” Towns said. “You’re there on the ground floor, and we appreciate you for that. We hope that over the next few months and as we face the next budget, that we will be able to reach your targeted goal to create a pool of $15 million over the next three years [to support CDFIs].” Edman, who coordinates the state Senate Banking Committee for State Sen. Hugh Farley, the sponsor of the New York CDFI legislation in the Senate, expressed the senator’s support for the work of CDFIs in extending affordable housing to residents of low-income urban and rural communities throughout the state.

JetBlue exec touts CU model says FSCC

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SAN DIMAS, Calif. (5/16/08)--A JetBlue executive is touting the credit union model, according to the Financial Service Centers Cooperative (FSCC). The credit union model is “better positioned to deliver members unique and personalized retail services than a commercial bank,” said Ann Rhoades, founder of JetBlue Airways. Rhoades is scheduled to speak at FSCC’s Retail Delivery Convention in Chicago June 11-13. Rhoades has worked with several credit unions, including Southwest Airlines FCU, Dallas. “At Southwest Airlines FCU we had a very loyal following among our employees who did not switch, even when they left our organization, because they felt the credit union offered the best service model,” she said. She also is working to launch a credit union for JetBlue. Sarah Canepa Bang, president/CEO of FSCC, said Rhoades’ “multi-faceted experience will provide attendees with an innovator’s approach to serving consumers,” she said. The convention will feature a number of speakers, from credit union and financial consultants, to industry leaders and other speakers who have influenced the credit union movement, FSCC said.

CUs on the Tube Wisconsin CUs share the REAL story

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PEWAUKEE, Wis. (5/16/08)--Wisconsin credit unions are telling the stories of how they are serving members through REAL Solutions in a video created by the Wisconsin Credit Union League. The league interviewed representatives from several credit unions about how they are helping members. The league collected “hours of footage,” and shared the highlights in a 13-minute video, Chad Helminak, league public relations specialist, told News Now. The league decided to create the video, “The Real Story about Wisconsin Credit Unions,” after finishing a more formal video on REAL Solutions that emphasized the importance of outreach and REAL Solutions to credit unions. REAL Solutions is a program aimed at helping provide financial services to people of low-wealth and modest means, and is a signature program of the National Credit Union Foundation. “We wanted to touch on some of the smaller aspects,” Helminak said. He defined REAL Solutions as anything credit unions do without profit for members. To encourage participation in the interviews, the league took a camcorder to its annual convention and raffled off a Nintendo Wii to participants who shared their stories. The reaction to the video has been one of pride. “We have great stories, and when other credit unions see them, they’re inspired to tell their story,” Helminak said. Jill Weber, league director of member solutions, agreed. “For our first time doing something like this, we’re very pleased with how it turned out,” she said. The league hopes to continue creating videos and using interview snippets for podcasts, Helminak added.

Staff member OK after robber pepper-sprays them

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LONGVIEW, Wash. (5/16/08)--An armed man lined up eight credit union employees and one member in the credit union and pepper sprayed them all, then fled with a bag of cash Tuesday afternoon. The man, who displayed a semiautomatic handgun, reportedly took off his mask as he left and said, “Good day, gentlemen,” to two men who were standing outside Fibre FCU, police said (Associated Press May 14). A police dog followed the scent but could not locate the suspect who robbed the $582.7 million asset, Longview, Wash.-based credit union, police said. No one required hospitalization, but the credit union closed for the afternoon, shortly after the 4 p.m. robbery, Larry Hoff, Fibre CEO, told News Now. The credit union reopened Wednesday morning, but the eight affected credit union employees were given the day off, Hoff said. “Counselors have come in since the event, and the affected staff are taking advantage of that offering,” Hoff added. Police believe the suspect is the same man who robbed a Centralia branch of Bank of America more than an hour after the Fibre heist. In that robbery, he fired one shot in the air but didn’t use pepper spray (tdn.com May 15).

Two CU employees homes damaged by wildfires

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PALM BAY, Fla. (5/16/08)--Two credit union employees’ homes were affected by recent wildfires in Florida, according to the Florida Credit Union League (FCUL). Fires began burning on Tuesday, near the towns of Palm Bay and Malabar. Police have arrested a suspect in connection with deliberately setting a fire (News Now May 15). Space Coast CU, based in Melbourne, reported to the league that two of its employees’ homes were damaged by the blaze. One of the homes was completely lost, Amy Jowers, league vice president of communications, told News Now. Community Educators CU said that several of its members were impacted by the fires, mostly through continual power outages. The outages spoiled several families’ refrigerated food. A total of 162 homes in Palm Bay were affected, Jowers said. Community Educators and Space Coast are accepting donations to help those displaced by the fire. On Wednesday, Community Educators’ Palm Bay branch opened to serve dinner to people affected by the fires. The credit union received “generous donations from Wal-Mart, Frito-Lay, Coca-Cola and Culligan Water,” Jowers said. The FCUL continues to monitor the situation.

CU System briefs (05/15/2008)

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* PEWAUKEE, Wis. (5/16/08)--Wisconsin credit unions raised $348,595 in 2007 to benefit sick and injured children treated at local nonprofit hospitals in the Children's Miracle Network (CMN), said the Wisconsin Credit Union League (The League May 12). Nationally, credit unions and their trade associations raised about $8 million last year, compared with $7 million in 2006, for CMN. The funds provide charity care, special treatment programs, and research and equipment. The funds also are sent to the CMN-affiliated hospital nearest the area where the funds are raised … * HARRISBURG (5/16/08)--Mary Beth Wilcher, chief marketing officer at Erie (Pa.) FCU, was a guest on a 30-minute talk radio show Wednesday on JET Radio 1400, according to the Pennsylvania Credit Union Association (Life is a Highway May 15). The topic was credit unions. She discussed who can belong, how credit unions differ, credit unions' iBelong awareness campaign; and the future of credit unions. Other topics discussed included challenges facing credit unions and the current mortgage crisis. Erie FCU will participate in eight monthly interviews during 2008. Each segment will focus on a different credit union topic …

League CEO testifies before N.Y. state committee

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LATHAM, N.Y. (5/16/08)--The president/CEO of the New York State Credit Union League testified before a state committee to voice support for and concerns about a bill proposed by the state in response to the mortgage and subprime lending crisis. William J. Mellin, league president/CEO, appeared before the New York State Standing Committee on Banks on behalf of New York’s credit unions to voice his support of the Governor’s Program Bill #44 (S.8143/A.10817).
William J. Mellin, president/CEO of the New York State Credit Union League, addresses the state Standing Committee on Banks at a public hearing in Albany Monday to evaluate the governor's program bill to address mortgage foreclosures and subprime loans in the state. (Photo provided by the New York State Credit Union League)
The bill, introduced in response to the mortgage foreclosure crisis and subprime lending practices in the state, primarily seeks to expand protections currently afforded to high-cost mortgages to a new category of non-conventional mortgages; strengthen and expand New York’s Anti-Predatory Lending law; and amend the penal law to include crimes relating to mortgage fraud. Throughout his testimony, Mellin expressed credit unions’ support of all aspects of the legislation except for a low interest-rate-threshold component. “While we agree that the existing thresholds are perhaps too high for the industry, we are concerned that the thresholds proposed in this bill are too low,” said Mellin. “If thresholds are to remain a key component of the legislation, I ask that you consider the unique not-for-profit, member-owned, ‘people helping people’ philosophy of credit unions and exempt them from a stated threshold.” Mellin laid out credit unions’ history of responsible lending to the committee chaired by Sen. Hugh Farley (R-Adirondack/Capital). He shared basic credit union underwriting practices where both borrowers and lenders have a mutual interest in each other’s success, and how the proposed threshold might negatively impact a credit union’s ability to make loans to its membership. Also, Mellin pointed out how the threshold would not only apply to the economically disadvantaged, but also affect a class of borrowers that historically have not been in need of increased legislative or regulatory protections. “Credit unions do not engage in predatory practices,” stated Mellin. “Credit unions were originally formed to help many New Yorkers achieve the ‘American Dream’ when other lenders would not (help), and this current crisis again demonstrates the need for credit unions.” Mellin encouraged the committee to focus more on underwriting principles and to consider credit unions as a viable solution to today’s subprime mortgage crisis.

Ohio Senate passes stringent payday lending bill

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DUBLIN, Ohio (5/15/08)--The Ohio Senate voted 29-4 Wednesday to approve landmark legislation that will impose some of the most restrictive regulations in the country upon Ohio’s payday lending industry. State lawmakers made a distinction between Ohio's payday lending industry and a program offered by credit unions as an alternative to short-term lending. The legislation, substitute House Bill 545, does not impact the StretchPay program offered by many Ohio credit unions as an alternative to short-term lending. The bill caps the interest rates that payday lenders can charge consumers at 28% annual percentage rate (APR) (down from the current 391% APR), prohibits loans of less than 31 days, and limits consumers to four payday loans per year. It would also ban Internet payday lending. Despite attempts within the past few days by some opponents of the bill to equate themselves with credit unions, the Ohio Credit Union League was able to continue its educational work in the Senate by again informing legislators on the all-around financial relationships that credit unions have with their members. “While some parties talked about credit unions possibly being an alternative vehicle for payday lending customers, the league has always maintained, and legislators supported, the idea that our mission is not remotely close to the corporate design of a payday lender,” said league General Counsel John Kozlowski. “Comparing the two entities was an extreme reach at the very best.” League President Paul Mercer praised Kozlowski and Capitol Advocates, the league’s retained Statehouse lobbying partners. “Credit union interests were protected and advanced with great success,” said Mercer. He also complimented politically active credit unions throughout Ohio. “The personal relationships that credit unions have with legislators in their districts were crucial in deterring efforts by some parties to draw credit unions into the debate on HB 545,” said Mercer. “We have maintained since day one that credit unions are not payday lenders and do not exist for the sole purpose of providing small-amount loans,” said Kozlowski. “Credit unions have always focused on an overall financial relationship, including financial literacy and education, for all members.” The Senate Finance and Financial Institutions Committee Wednesday morning made minimal changes to the legislation, which the Ohio House of Representatives passed two weeks ago. Most of the minor changes to the bill were requested by the Ohio Department of Commerce. They included a seven-month delay in implementing a statewide consumer database required by the legislation. Substitute HB 545 will go back to the Ohio House next week for a vote to approve the changes made by the Senate. If the House concurs with the Senate bill, HB 545 will then go to Gov. Ted Strickland for his signature.

Calif. CUs healthy despite housing impact says league

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RANCHO CUCAMONGA, Calif. (5/15/08)--California's credit unions are well-equipped to weather the downturns in the state's and nation's economy, says the California Credit Union League. Because of a few high-profile losses, credit unions elsewhere may get a skewed view of credit unions' economic status in the state. But credit unions overall in the state are healthy. "Credit unions in California remain well-capitalized and therefore are equipped to handle the economic downturns," said Terrin Griffiths, league economist and analyst. Capital at the state's credit unions for year-end 2007 was at 10.94%, compared with 10.99% at year-end 2006, she told News Now. "We haven't seen an erosion of capital in the state's credit unions." Chris Collver, league regulatory and legislative analyst, said "delinquencies to total loans have increased from 2006 to 2007 but are still well below 1%." In 2007, delinquencies were 0.85%, compared with 0.47% in 2006. The National Credit Union Administration historically has considered 1.25%-1.50% and under as acceptable, he added. California has more than 500 credit unions. A few credit unions have seen widespread coverage in the news because of problems with home equity loans failing as the housing market boom state struggles with the nation's housing market crisis. "The other credit unions that are in the news are there not because they're in the trouble but because they're taking corrective steps to move their loan delinquencies to the allowance for loan losses side, which they are supposed to do. That's why credit unions have capital," Collver told News Now. Since the state is in a housing crisis, why aren't more California credit unions affected? "Credit unions have different, more stringent lending standards," said Griffiths. "During the boom in the housing market, credit unions offered a wide variety of affordable loans but they didn't relax (lending) standards." They weren't making as many loans, which may not be good from a growth perspective at that time, but now their standards are serving them well, she said. Collver noted that CEOs have told the league their credit unions are taking losses because of bad loans given to members by other financial institutions, whether in the form of credit cards or loans the members got somewhere else and that were not in the best interest of the members. "A ripple effect has been felt by some credit unions," he said. True to their nature, credit unions are reaching out to help those members. "Credit unions are extending their outreach to help members and nonmembers and making them aware of their products. They've invited members to review their line of products," said Griffiths. "Because housing prices are declining in California, however, it is hard to work with some of the (original) loans. Credit unions can offer help for those going into foreclosure or who need to sell their homes. They can make loans to help the members buy time. They try to alleviate the stress that is part of being the homeowner," she said. The point is, says Collver, "credit unions are not engaged in abusive lending tactics, and they're well-capitalized and continue to be." That's true for credit unions both in the state and in the nation, he said. "In the U.S., it's the same story, with credit unions in a very healthy position."

CUs help those displaced by Florida wildfires

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PALM BAY, Fla. (5/15/08)--Several Florida credit unions are working with United Way to help those displaced by recent wildfires in the state. The wildfires began burning on Tuesday. The largest blaze burned 3,800 acres in the towns of Palm Bay and Malabar. About 34 miles of the interstate in Brevard County was closed Tuesday because of smoke, and all 18 schools in Palm Bay were closed Tuesday (USA Today May 14). Police arrested a suspect yesterday regarding a wildfire that was deliberately started in Palm Bay (CNN May 14). Community Educators CU, Rockledge, teamed up with United Way of Brevard County and is collecting donations at all seven of its branch locations in Brevard County. Donations can be made in cash, by check or by using Visa or MasterCard. The fund gives 100% of all donations to relief. The credit union also opened up a business office 9 a.m. to 6 p.m. yesterday for victims in its Palm Bay branch to notify loved ones and contact insurance companies. The credit union held a dinner on Wednesday for those displaced by the fires. “It has long been the policy of Community Educators CU to be responsive to those affected by fire emergencies, hurricanes and natural disasters,” said Sara Stern, Community Educators vice president of marketing. “We hope to help families get back on their feet more quickly by providing the resources they need at this unfortunate time.” The credit union is accepting any non-perishables at all of its branches. Needed items include sun block, bug spray, water and blankets. Firefighters need water, socks, sunscreen and Chapstick. Space Coast CU, Melbourne, is accepting donations for the United Way at all of its branches. It has four branches in the Palm Bay area. The Miami Herald Wednesday reported that a credit union employee, Brenda Civita, lost her home in the fire. The newspaper did not name the credit union. News Now was unable to confirm the credit union by press time.

CUs consolidation featured in Pittsburgh paper

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PITTSBURGH (5/15/08)--A feature article in the Sunday Pittsburgh Tribune-Review discussed the consolidation of Pennsylvania credit unions. The article presented a positive look at how credit unions in the state are weathering current economic conditions and seizing opportunities to serve their members, said the Pennsylvania Credit Union Association (PCUA) (Life is a Highway May 12). The interview took place during the PCUA’s annual convention in Pittsburgh and was conducted at Allegent Community FCU. Participating in the interview were: Jim McCormack, PCUA CEO; Diana Roberts, PCUA board chair; Kevin Anglemyer, CEO, Allegent Community FCU, Pittsburgh; and Ralph Canterbury, vice president, Clearview FCU, Moon Township. Although the number of Pennsylvania credit unions has dropped below 600 for the first time in 60 years, the mood at the PCUA convention was upbeat, the article noted. “In these bad times, credit unions see there are opportunities for them,” McCormack was quoted in the article. “They are not cutting back. They have money to lend.” As consumers try to get out of their adjustable rate mortgages and into fixed-rate loans, mortgage refinancings are probably the busiest area for the $109.5 million asset Allegent Community CU, Anglemyer told the paper. A good boost in mortgage refinance volume also is being experienced at the $42.7 million asset, Hummelstown, Pa.-based Hershey FCU, said Roberts, Hershey president. Credit unions have entered business lending in the past five or so years, with about one in six Pennsylvania credit unions writing business loans, McCormack told the paper. The typical business loan is between $100,000 and $1 million--often to buy a piece of equipment, he added. “As credit has dried up at banks, credit unions are welcoming small-business loans,” McCormack said in the article.

CUNA Management School tops list of July learning events

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MADISON, Wis. (5/15/08)--CUNA Management School is one of several learning opportunities available for credit union professionals in the Credit Union National Association (CUNA)’s July event schedule. CUNA Management School is scheduled for July 13-25 in Madison. The program challenges credit union professionals to be leaders in the credit union movement by providing them with leadership skills and lessons. The program consists of three years of a single two-week session each summer. Topics addressed include credit union philosophy, organizational behavior, crisis management, coaching and leadership, business law, politics and legislation, marketing, human resources, finance, accounting, ethics and economics. CUNA Management School has three regional locations:
* Southwest region--Texas Christian University, Fort Worth, Texas. Contact Janine McBee at the Texas Credit Union League; * Southeast region--University of Georgia, Athens, Ga. Contact Jennifer Green at the Louisiana Credit Union League; and * Western region--Pomona College in Claremont, Calif. Contact Nancy Dotson at the California Credit Union League.
Other July learning opportunities from CUNA include:
* Business Lending Certification Institute: Management Strategies, July 21-25, Madison, Wis. The program is created for those responsible for the strategy, planning, and management of an established program and will include an evaluation process to help attendees formu action plans to improve their current lending program. * Business Lending Certification Institute: Fundamentals, July 21-25, Madison, Wis. The program explains the components of offering business lending services to build a solid program foundation. It will start with lending regulations and business basics, and move into financial and application analysis, loan structuring, loan default warning signs, member loan protection, and additional member business services. * Business Lending Certification Institute: Credit Analysis, July 21-25, Madison, Wis. The program will help attendees develop skills to perform an in-depth evaluation of the credit needs of member businesses. Topics include: business credit and tax return analysis, financing fast-growth businesses, loan repayment, business life cycles, financial projections, and business plan case studies. * Business Lending Certification Institute: Advanced Credit Analysis, July 21-25, Madison, Wis. The program focuses on evaluating the financing needs of different industries--manufacturing, service sector, retail and commercial real estate. It also covers financing the purchase of an existing business and uses case studies and loan requests to help participants better understand the specific markets, issues, and red flags of each industry. * Compliance Fundamentals Seminar, July 19-20, Chicago. The overview seminar is offered as an introduction or refresher of more than 25 regulations that affect credit unions on a daily basis; * Regulatory Compliance School, July 20-25, Chicago. It will cover regulations for mortgage and consumer lending, deposit accounts, and general operations, along with National Credit Union Administration requirements and guidance issues. * Regulatory Compliance School: Update, July 20-24, Chicago. The school will explore vendor due diligence and the Bank Secrecy Act, as well as compliance issues for mortgage and consumer lending, eBanking, and more. Participants also will learn about the NCUA’s red flag issues for the year, credit card breaches, and effective compliance audits. * Building Credit Union Leadership Through Communications eSchool, July 23-Aug. 20. Course work will uncover the keys to engaging communications and how to use these skills to build collaborative teams, develop relationships with staff, and create member service excellence.
For more information, use the links.

Oklahoma Texas leagues discuss partnership

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TULSA, Okla. (5/15/08)--The Oklahoma Credit Union League is discussing a possible partnership with the Texas Credit Union League to outsource services. In August, the Oklahoma league approached other credit union leagues to see if they had any services they could offer Oklahoma, said Debra Morrow Ingram, league interim president/CEO. Four leagues responded and put together proposals for a partnership with Oklahoma. All of the proposals were good, but partnering with Texas makes the most sense, Morrow told News Now. The Oklahoma league is evaluating what a partnership with Texas would entail. No financial arrangements have been made. A solid proposal for the board of directors to evaluate should be ready by the May 28 board meeting, Morrow said. A partnership between leagues makes a lot of sense, because “there are similar things we all do,” she said. "We are delighted to have an opportunity to partner with a neighboring league," Dick Ensweiler, president/CEO of the Texas Credit Union League, told News Now. Even though a partnership would lead to the outsourcing of some services, there are some things that each league should handle on their own--like advocacy, legislative advocacy, compliance and media relations, Morrow said. The Oklahoma league decided to pursue a possible partnership with another league after looking at itself to see what services it offers and what services it can improve upon. Other factors contributing to the decision to seek a partnership are some changes the league has and will undergo--such as the departure of the league’s former CEO and plans for the league to move its headquarters from Tulsa to Oklahoma City. The partnership exploration process has “been a good learning experience,” Morrow noted. “We saw the good services we provide to members, and we saw the services other leagues provide. “Even if we don’t contract with a league for services, we may try to emulate them,” she said.

Corporate Central announces new board

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MUSKEGO, Wis. (5/15/08)--Three credit union CEOs were elected as directors during Muskego, Wis.-based Corporate Central CU’s annual meeting May 8. The new directors are:
* Gerald A. Forsythe, Altra FCU, Onalaska, Wis.; * Greg A. Hilbert, Fox Communities CU, Appleton, Wis.; and * Brian J. Prunty, CoVantage CU, Antigo, Wis.
Corporate Central directors elected officers at the May 8 board meeting to serve for the 2008-2009 year. They are:
* Chairman: Daniel Ige, president/CEO, “Golden Rule” Community CU, Ripon, Wis. * Vice Chairman: Forsythe; * Secretary: Hilbert; * Treasurer: Richard A. Koenig, president/CEO, Prime Financial CU, Cudahy, Wis.
Other directors constituting Corporate Central CU’s nine-member board include:
* Prunty; * Kim Sponem, president/CEO, Great Wisconsin CU, Madison, Wis.; * Gerald E. Tiedt, president/CEO, Premier Financial CU, New Holstein, Wis.; * Ronald Vogel, president/CEO, Fort Community CU, Fort Atkinson, Wis.; and * Thomas P. Young, president/CEO, Pioneer CU, Green Bay, Wis.

A whole lot of shredding going on at CUs

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MADISON, Wis. (5/15/08)--Credit unions were busy conducting shredding events around the country the past few weeks, both to combat identity theft and to go green in recycling efforts. State Employees' CU (SECU), Raleigh, N.C., partnered with state agencies and Iron Mountain Shredding Co. for its first Scam Jam on May 3. The event was for SECU's Golden Circle members--those 50 and older--who live within an hour of the site. "Senior adults are the primary target for so many of today's scams, including identity theft," said Karen Daeke, vice president of SECU's security administration department. In addition to shredding personal documents, the event provided educational workshops and informational booths. Other sponsors included the state Attorney General's Office, Division of Aging and Adult Services, and Adult Protective Services Retired Governmental Employees' Association. In Oregon, three credit unions held shredding events April 19, according to the Credit Union Association of Oregon (Oregon Outlook May):
* Mid Oregon FCU and Secure Shred sponsored a "Free Shred" day to help community members purge old tax records and outdated records. The shredded materials are recycled as tissue paper.
Volunteers from MaPS CU, Garten Services and South Salem (Ore.) High School band helped direct traffic and collect items to shred during the credit union's Annual Free Community Shred event. (Photo provided by the Credit Union Association of Oregon)
* At MaPS CU's fourth Annual Community Shred event, co-sponsored with Garten Services and KBZY Radio, members shredded 16,782 pounds of documents, recycled 8,347 pounds of computer systems, and donated 290 pounds of cell phones. The event attracted 668 cars--an average of 2.5 cars per minute. * SELCO Community CU and CDI Vaults partnered to hold ShredFest, an event in which SELCO members and the public could bring up to one trunkload of documents to shred.
In Missouri, more than 700 cars and trucks lined up at First Community CU, Chesterfield, to shred more than 14,000 pounds of documents on its shred day April 12. "Identity theft is an ongoing issue across the country, and shredding documents makes it more difficult on identity thieves, said Debra Wapelhorst, event planner. It's also an "environmentally friendly solution," she told the Missouri Credit Union Association (CourierNet April 23). In Texas, almost 2,500 people used the free shredding service at San Antonio FCU (SACU)'s Sixth Annual Shred Day on April 19. The credit union joined four local shredding companies, WOAI News 4 and the Association of Records Managers and Administrators to sponsor the event. Trucks shredded or collected 59 tons of paper for recycling, and participants donated $5,000 for Dress for Success of San Antonio, an organization that helps women gain skills to re-enter the work force. According to the Texas Credit Union League, other Texas credit unions with recent shredding events were AMOCO FCU, Texas City, with 15,000 pounds of shredded paper from 1,500 boxes; Cy-Fair FCU, Houston; DATCU, Denton; and East Texas Professional CU, Longview (LoneStar Leaguer May 1).

CU System briefs (05/14/2008)

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* OAKLAND, Calif. (5/15/08)--Four men were arrested after a takeover robbery Tuesday at a Berkley, Calif.-based credit union. Police recovered the money and a cache of guns, said Berkeley police. The masked men, two of them armed, entered Cooperative Center FCU before noon on Tuesday. They ordered 20 employees and one member to the ground, and demanded all the money. A female teller was punched in the back of the head but was not seriously hurt. As the four fled, an employee wrote down the getaway car's license plate number. Police spotted the vehicle and after a high-speed chase, the car crashed into a parked vehicle. Three were arrested there and a fourth at a nearby apartment complex (Contra Costa Times May 14) … * DURHAM, N.C. (5/15/08)--Forty Hispanic adults from across North Carolina graduated from Latino Community CU's Financial Education workshops in a ceremony at the Center for Responsible Lending in Durham, N.C. Special guest Rafael Prieto, editor of Charlotte's Mi Gente newspaper, told the group that "as long as we don't know how to manage our income, we will be invisible in this country." In the photo, graduate Miguel Fuentes speaks to the group, who completed six workshops. Workshops are presented three times a year. The next series begins Sept. 8. (Photo provided by Latino Community CU) … * FREDERICTON, N.B. (5/15/08)--New Brunswick lawmakers plan to amend a law to avoid repeating another credit union bailout similar to one the province approved last year. In March 2007, the province approved a $60 million bailout for the credit union Caisse Populaire de Shippagan and the New Brunswick Credit Union Deposit Insurance Corp. The amendments are to provide a better balance between deposit protection and taxpayer protection. Changes would include lowering the maximum coverage of deposit insurance from the current unlimited coverage to $250,000 per qualifying account (Macroworldinvestor.com May 14) … * ANTIGO, Wis. (5/15/08)--Richard Goodman, former CEO of Antigo Co-op CU (now known as CoVantage) died May 10, according to the Wisconsin Credit Union League (The League May 12). Goodman began his career in 1957 and spent 33 years with the credit union before retiring. Services will be today at St. John Catholic Church in Antigo …

Truliants 0 auto financing nets 1650 loans

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WINSTON-SALEM, N.C. (5/15/08)--Truliant FCU’s first nine months of a 0% auto financing program resulted in 1,650 auto loans worth $25 million. The $1.086 billion asset, Winston-Salem, N.C.-based credit union started the program last year in a move that led to the credit union directly competing with auto dealerships that provide zero financing (Winston-Salem Journal May 13). Truliant took an idea from auto manufacturers and reinvented it to make it more appealing to credit union members, said Jeff Hardin, North Carolina Credit Union League spokesman. Using Truliant’s zero-rate auto loan, members pay all of their interest up front. The down payment lowers their monthly payment and finance costs, Truliant Spokesman Ryan Shell told the newspaper. Members can use the loan to purchase a used or new car or refinance an existing loan on any car. Average savings over the life of the loan for people using zero financing is about $1,200, Shell said. Hardin said he is unaware of any program that is comparable to Truliant’s zero-rate loan.

Card violates one bank one CU rule say defense CUs

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ALEXANDRIA, Va. (5/14/08)--A new rewards MasterCard offered by Chase Card Services is prompting the defense credit unions to request the Department of Defense halt issuing the card. The credit unions say the card violates the “one bank, one credit union” rule allowing only a single bank and credit union for each military base. The Military Star Rewards MasterCard is a collaboration between the Army and Air Force Exchange Service (AAFES)--which manages the military exchange credit card program--and Chase Card Services, an affiliate of JP Morgan Chase (Marine Corps Times May 5). The defense credit unions also said that the card violates the Pentagon’s own prohibition against the exchange operating banking services. The card, which debuted May 1, gives users two points for every dollar spent on the military installations at commissaries, exchanges, gas stations and other retail outlets. The card also can be used outside installations, unlike the military exchanges’ regular Military Star card. In essence, AAFES and J.P. Morgan Chase are issuing a co-branded card for military personnel to use on and off base. This is a violation of the “one bank, once credit union” policy, Arty Arteaga, president/CEO of the Defense Credit Union Council--which represents credit unions on U.S. military bases--told News Now. “Only the one bank and one credit union can provide financial services to military personnel per the policy,” Arteaga said. “The legal counsel at Defense Finance and Accounting Services agrees with this. However, AAFES does not. So on April 29, we asked the Department of Defense general counsel for a ruling. At this time, we are waiting for that ruling. If the office of the general counsel decides there’s a violation of the rule, AAFES would have to request an exception to that policy before it could proceed. “The Army and Air Force are aware of our concerns, and they know we oppose the granting of an exception for the policy,” Arteaga said. “We are addressing an issue with AAFES, we’re not fighting JP Morgan Chase,” Arteaga added.

Payday lenders propose using CU code for fees

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COLUMBUS, Ohio (5/14/08)--Payday lenders in Ohio have proposed using state credit union regulations for interest rate caps so they can charge more fees. If the industry proposal was enacted, payday lenders would be able to operate under a seldom-used section of the Ohio revised code that permits credit unions to charge 18% annual percentage rate and up to $10 for every $100 borrowed for a one-month period (Cleveland Business News May 12). House Bill 545 passed in the Ohio State House and could be voted on in the State Senate as early as this week. However, the statute that the payday lenders want to be regulated under may soon be gone. The Ohio Credit Union League agreed Friday not to protest the removal of the statute that payday lenders want to be regulated under, John Kozlowski, league general counsel told the newspaper. Credit unions have not used the statute, which was originally sought by credit unions to ease interest rate caps so they could create loan products to compete with higher-cost payday loans, Kozlowski said. Credit unions used their creativity to come up with short-tem signature loans and payday alternatives such as StretchPay--two products that are below the state’s 24% interest cap, Kozlowski told the paper.

Dollar Where will CUs be in 2020

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NEWPORT BEACH, Calif. (5/14/08)--Where America’s credit unions find themselves in 2020 will be determined by their vision in 2008 and the decisions that accompany the vision, said Dennis Dollar, former National Credit Union Administration (NCUA) board member, at the National Association of Credit Union Service Organizations (NACUSO) Annual Conference April 29 in Las Vegas. In the future, credit unions will be the dominant community-based financial institutions in most communities because bank mergers will create more nationwide megabanks, Dollar predicted. The megabanks will lead to a disconnect with local citizens who seek a personal touch. Credit unions also will dominate community banking sectors in the year 2020, Dollar added. Other predictions for 2020:
* A risk-based capital system will be implemented to bring credit unions into the regulatory mainstream; * Field-of-membership rules will still exist, but will be safety and soundness-driven; * Credit union directors will face more fiduciary responsibilities requiring continuing education and some type of director compensation will be authorized for increased responsibility; * Credit unions will retain federal tax-exemption status; * Credit unions’ political activism must continue; * Credit union service organizations will exceed the number of credit unions; * Credit unions will face greater regulatory pressures, and this will drive mergers; * Credit unions will market cooperatively nationwide; and * Shared branching will be a key credit union differentiator, with nearly all credit unions participating nationwide, thus reinforcing a national branding campaign.

NACUSO speakers highlight third-party due diligence

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NEWPORT BEACH, Calif. (5/14/08)--Credit unions should improve strategic planning, ensure balance in third-party contracts and perform due diligence. This message was delivered by Gigi Hyland, National Credit Union Administration (NCUA) board member, at the National Association of Credit Union Service Organizations (NACUSO) Annual Conference April 29 in Las Vegas. The NCUA recently published a letter on third-party relationship evaluation, and Hyland spoke about the key regulatory issues involved. Credit union service organizations (CUSOs) should create a working process of knowledge for regulators to understand what CUSOs do and do not do for credit unions, she said. Guy Messick, NACUSO general counsel and attorney at Messick and Weber in Media, Pa., presented information on complying with NCUA’s letter. He also noted that NACUSO President Thomas Davis serves on the Credit Union National Association committee on the issue. “NCUA’s admonitions to credit unions regarding their relationships with third parties are a good thing, for safety and soundness reasons and the effective management of credit unions,” Messick said. “The norm is for credit unions to have ad hoc relationships with numerous vendors, and with no person in the credit union knowing all of the contractual terms or even how many vendors serve the credit union.” One credit union that recently took inventory of its third-party relationships found that it had over 200, Messick noted. NCUA also is asking credit unions three questions, Messick said:
* Does outsourcing fit with the credit union’s strategy and risk tolerance? * Is the proposed vendor a credible and effective provider? and * How will the credit union monitor the relationship and manage the risk?
CUSOs need to be ready to help credit unions meet their duty in evaluating and monitoring the relationship. They should have due diligence packages to hand to credit unions. CUSOS also should provide credit unions with performance reports, and non-CUSOs should do the same, Messick added. It is critical for credit unions to reorganize their management structure to manage the new credit union outsource-rich model. “It is not your father’s credit union anymore, where the vast majority of key services are provided by employees,” Messick said. “Credit unions outsource a multitude of key functions, and this trend will continue as credit unions look for greater expertise and lower operating costs. “There should be a service-provider policy approved by the credit union’s board and implemented by staff. Each credit union needs to have a senior management position whose job is to manage and monitor third-party relationships and implement the board’s service provider policy. Accountability is crucial.”

Americas CU Conference plans event at Rainbow Room

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MADISON, Wis. (5/14/08)--Attendees at the America's Credit Unions Conference and Expo (ACUC&E) in New York City will spend their last evening in the Big Apple at an event in the world-famous Rainbow Room.
Click to view larger imageAttendees at the America's Credit Union Conference and Expo June 29-July 2 in New York City can spend their last evening in the Big Apple eating and dancing in the famed Rainbow Room in the Rockefeller Center. (Photo provided by the Credit Union National Association)
ACUC&E, scheduled for June 29-July 2, is the annual conference presented by the Credit Union National Association (CUNA). CUNA's Power Up Party will be 8-10:30 p.m. Tuesday, July 1, at the Rainbow Room, located on the 65th floor of Rockefeller Center. The room overlooks the north, south and east side of Manhattan. From its opening day in 1934, the Rainbow Room has epitomized Manhattan luxury. It was named for the lighting effects from a floor made of 360 glass blocks atop more than 2,600 red, green, blue and amber lights. A custom-made pipe organ synchronizes the lights and colors with the music while patrons dance to big band sounds. Attendees will gather to socialize over appetizers and cocktails, then dance on the revolving dance floor. The event is included with attendees' registration. Guests may attend if they purchase the Guest Program. Dress will be business casual. CUNA is expecting a record attendance for the conference, said Todd Spiczenski, vice president of CUNA's center for professional development. "Currently the exhibit hall is nearly sold out, and credit union attendees are registering at a record pace," he said.

Pennsylvania CUs closed in rare noreaster

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HARRISBURG, Pa. (5/14/08)--A rare spring storm--known as a nor’easter--knocked down trees and power lines in southeastern Pennsylvania, resulting in a power outage that closed three credit unions Monday. The outages resulted in the late morning closings of Delco Postal CU; P.S.T.C. Employees FCU; and Upper Darby Belltelco CU, all located in Upper Darby, Pa. (Life is a Highway May 13). Power was restored to the area by 7 p.m. Monday. The outage was describe as “a minor nuisance” with everything up and working fine Tuesday morning, John Schmidt, CEO, Upper Darby Belltelco, told the Pennsylvania Credit Union Association. Bob Manning, CEO of P.S.T.C. Employees, stayed at the credit union and distributed checks that had been processed before the power outage to members who came to pick them up. Manning said members were understanding of the situation and that this demonstrates why credit unions are better than banks. “You wouldn’t see a banker standing at the door handing out checks to customers who needed their money,” Manning said.

CUSO role CU changes addressed at NACUSO conference

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NEWPORT BEACH, Calif. (5/14/08)--Change for the credit union industry must come from within, not from outside pressures or influences such as mergers and charter conversions, fear of other financial institutions or the fallout from others' subprime lending, says Dan Clark, The New York Times best-selling author. Clark, a contributing author to the "Chicken Soup for the Soul" series, presented the keynote session at the National Association of Credit Union Service Organizations (NACUSO)'s 2008 Annual Conference in Las Vegas April 28. It is organizations like NACUSO asking members to fundamentally change from the inside that provides the real power to make a difference, Clark said. He told the more-than 400 attendees to stop worrying about mergers and start figuring out how to work collaboratively. To be relevant to current and future members, he said, the industry must look inward at what it does from the grassroots level. Credit union and CUSO leaders must not assume that people, especially young people, know the difference between a credit union and a bank, Clark said, recommending the industry educate people and prove the credit union difference through its actions. According to NACUSO President/CEO Thomas C. Davis, who opened the conference, there is a "need for CUSO members to drive credit union success. That's why we are in business." Describing the current state of the credit union industry as the best and worst of times, Davis said helping credit unions do those things that address tough industry issues will create an upturn in the inflection point of the industry life-cycle, enabling credit unions to begin a whole new growth curve. He noted the credit union industry can break with tradition, change its collective habits and collaborate to succeed much quicker than before. "Collaboration isn't just for today; this is for future generations. The decisions we make for the future of our industry, today, will echo in eternity."

Wisconsin league meeting Tell the CU story

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WISCONSIN DELLS, Wis. (5/14/08)--Share the credit union story, attendees at the Wisconsin Credit Union League's 74th Annual Convention, held May 7-10 in Wisconsin Dells, were told. "I know you believe in the credit union story, but the problem is that we're leaving the story to the banks to tell--and the story they tell is more like a Stephen King horror novel," said league President/CEO Brett Thompson, addressing the convention. "Our reluctance to tell our story will doom us. Our detractors can go everywhere we can go, and they have a lot more money to do it," he said. "They can offer more products and services; they can offer
The Wisconsin Credit Union League’s executive committee was announced at the league’s Annual Convention May 7-10. From left are: Dean Wilson, Focus CU, Milwaukee; Pat Lowney, Lakeview CU, Neenah; Jerry Kuschel, P.C.M. Employees CU, Green Bay; Jack Gill, First Community CU, Beloit; and Kevin Hauser, Westby (Wis.) Co-op CU.
The Wisconsin Credit Union League’s newly elected board of directors includes, from left: Scott Roesch, Fond du Lac (Wis.) CU; Mike Mallow, Sheboygan (Wis.) Area CU; Lora Benrud, WESTconsin CU, Menomonie; and Paul Kundert, University of Wisconsin CU, Madison. (Photos provided by the Wisconsin Credit Union League)
great service; they can offer creative, slick ad campaigns," he added. "But they can't say it's about people, not profit; they can't say it's about member-owners; they can't say it's about lower cost payday loan alternatives; they can't say it's about not making the subprime loans to begin with; and they can't say it's about having more branches in low-income census tracts without a legal requirement to do so. "You can say that," he concluded. During the league's annual meeting, attendees approved changes in the league's districts and credit union representation, according to the league's newsletter The League (May 12). The board size will be reduced to nine members from 15. Five will be elected from the regions and four will be elected from asset categories. The league also elected its executive committee and new board (See photos).

CU System briefs (05/12/2008)

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* PHOENIX (5/13/08)--Arizona State CU has been ranked as the No. 1 credit union in the state for the second consecutive year in the 2008 edition of Ranking Arizona: The Best of Arizona Business. The book is published by Arizona Business Magazine annually, and its rankings are based on the largest opinion poll in the state. More than 250 business and leisure categories are included. According to David E. Doss, president/CEO of the $1.2 billion asset credit union, 2007 saw the credit union create new products, expand member service and move into a new corporate headquarters. "All across the state, members saw more convenient and expanded banking services with offices staying open later during the week and in many locations providing convenient Saturday banking hours," he said … * SALT LAKE CITY (5/13/08)--Deseret First CU has been recognized by the U.S. Small Business Administration (SBA) as the top medium-sized lender in Utah for SBA-guaranteed business loans. The credit union was ranked first in the category of financial institutions in the state with assets between $100 million and $1 billion. Deseret First CU has $418.6 million in assets and is based in Salt Lake City (PR News Wire and UtahBusiness.com May 12 …

CUs not impacted by tornadoes

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TULSA, Okla. (5/13/08)--No credit unions or credit union members reported damage from tornadoes and storms over the weekend, according to the Oklahoma Credit Union League. Roughly 22 people died when tornados hit Oklahoma and nearby Plains states, and Georgia. Seven deaths were reported in Picher, Okla., and 10 deaths were reported in Seneca, Okla. (USA Today May 12). Neither town has a credit union listed. The U.S. death toll for tornados is this year is at 98--the most in 10 years. The tornadoes follow several other storms that hit Virginia two weeks ago.

State fee hike may prompt Carfax to leave Missouri

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JEFFERSON CITY, Mo. (5/13/08)--A new fee structure for Missouri motor-vehicle and driver records has Carfax--a company that provides vehicle histories for consumers buying used autos--threatening to stop serving Missouri customers. Missouri's Department of Revenue raised the fee to $7 per record, up from $1.25, and eliminated the bulk discount that Carfax and many other data collection companies, insurance companies, and even media use. The fee hike, which was to pay for the department's new $50 million computer system, amounts to a 460% hike and was effective May 1 (Post-Dispatch May 7). R.L. Polk & Co, Carfax's parent company, has used the title and registration data to compile vehicle history reports for the Carfax service, which is offered in some credit unions. Car buyers pay $30 to use the database for 30 days. The firm said that the increase would mean it would owe the state $42 million more than what it pays for data from all 50 states and Canada combined. Before the fee hike, the cost was less than a quarter of a penny per record, said Tim Sowton, regional director for government relations for the firm. The increase and elimination of the bulk discount is 300,000% more. "We cannot survive absorbing that kind of cost increase," he told the Kansas City Star (May 6). As a result, the company won't update its Missouri data, which means Missourians may not receive notices on automobile recalls, he said. In a hearing on May 6, state lawmakers challenged the agency, saying the hike may violate the Sunshine Law. Rep. Shannon Cooper (R-Clinton) indicated that he would draft a bill to halt the fees and "poke it on every bill out there" as an amendment.

Texas league offers grants to attend Latino conference

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FARMERS BRANCH, Texas (5/13/08)--The Texas Credit Union League (TCUL) is offering grants for Texas credit union professionals and volunteers to attend the Fifth Latino Credit Union Conference June 11-13 in Dallas. The conference affords credit unions the opportunity to learn strategies and techniques for serving their unbanked and underserved markets (LoneStar Leaguer May 7). TCUL accepted grant applications for credit unions in need of financial assistance through last Friday. The grants are made available through the Richard Ensweiler Fund and must be used for the Latino Credit Union Conference. Ensweiler is president of the league. The theme for this year’s conference, “Latinos and Credit Unions: The Crossroads Where Mission Meets Opportunity,” seeks to highlight the potential that the Hispanic market holds for the credit union system. The U.S. Hispanic population increased 1.4 million to reach 45.5 million on July 1, 2007--or 15.1% of the estimated total U.S. population of 301.6 million. The conference is organized by the National Federation of Community Development Credit Unions in collaboration with the Network of Latino Credit Union Professionals. TCUL is one of the sponsors.

Michigan mortgage summit emphasizes education

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NORTHVILLE TOWNSHIP, Mich. (5/13/08)--The Michigan Credit Union League (MCUL) Mortgage Lending Summit May 2 emphasized educating troubled borrowers about their options.
A full house of attendees listens to one of the Michigan Credit Union League Mortgage Lending Summit presentations May 2. (Photo provided by the Michigan Credit Union League)
The summit included updates from state and federal credit union regulators and agencies, and a panel of mortgage lending and insurance experts (Michigan Monitor May 12). Participants were told that workout assistance is available for borrowers who have difficulty making mortgage payments, and that these borrowers should be urged to consider talking with their credit union before “handing over the keys and walking away.” The goal is to keep even troubled borrowers in their homes, and keep property values from deteriorating, and preventing risk from being shifted to the credit unions, the summit indicated. Presentations highlighted borrower eligibility requirements, income limits, requirements imposed on the buyer and on the property, down-payment programs, homeownership counseling assistance, and access to the programs. “There was a lot of valuable information on the Mortgage Lending Summit agenda,” said Patrick La Pine, MCUL executive vice president. “I think many of the participants were surprised to learn how many programs are offered in today’s marketplace.”

CUs lower rates in race for auto loans

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MADISON, Wis. (5/13/08)--Some credit unions are coping with the downturn in the economy by lowering auto lending rates to gain an edge on the competition. Credit unions trying to make auto loans more appealing to members include:
* Pacific Service CU, a $1.107 billion asset, Walnut Creek, Calif.-based credit union, announced it lowered auto rates and simplified its loan program. Qualified borrowers will receive rates of 5.79% annual percentage rate (APR) for terms up to 66 months, and 6.79% APR for terms of 67-84 months. The new rates apply to new and used vehicles, including boats, motorcycles and recreational vehicles. It also is offering a $100 incentive to members to refinance their existing auto loans. * Fidelity FCU, a $30 million asset Sandy Springs, Ga.-based credit union, launched a new auto loan campaign for May, partnering with Enterprise Car Sales to offer loan rates as low as 2.9% on used cars. Fidelity has extended this offer to its members and to anyone who lives, works, worships, volunteers or attends schools in Sandy Springs. * Elevations CU, a $757.9 million asset, Boulder, Colo.-based credit union, last week lowered its best rate on Harley-Davison motorcycles to correspond with the same rate as its automobile loans. Motorcycle purchasers can obtain rates as low as 5.49% with the credit union on Harley-Davidson motorcycle financing. “Because Harleys are a high-ticket item, financing has been a hurdle to ownership for a lot of people. It’s not unusual to see loan rates in excess of 7% on these bikes,” said Craig Burkhard, chief lending officer at Elevations.
During first quarter 2008, credit unions' vehicle loans outstanding declined at a 6% annualized pace, compared with a decline of 2% for the same period a year earlier, says Southwest Corporate Investment Services. Those loans increased less than 1% during all of 2007, Brian Turner, director of advisory services (News Now May 12).

CUSN elects new board

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LAKEWOOD, Colo. (5/13/08)--Credit Union Service Network (CUSN) has announced the results of its Board of Directors election, held during its annual meeting Thursday in Golden, Colo.
Click to view larger image Board members of Credit Union Service Network include, from left: Board Vice Chair Keith Cowling, Credit Union of Denver; Secretary/Treasurer C. Michael Litzau of Sooper CU; Bob Hoefer, Dupaco Community CU; Chairman Carla Hedrick, Denver Community FCU; Stephanie Teubner, Warren FCU; Dave Maus, Public Service CU, Denver; Tom Evers, Premier Members FCU, Boulder, Colo.; and Mark Uden, Mutual lst CU. (Photo provided by Credit Union Service Network)
Incumbents Bob Hoefer, president/CEO of Dupaco Community CU, Dubuque, Iowa, and Keith M. Cowling, president/CEO, Credit Union of Denver, Lakewood, Colo., were re-elected to three-year terms. Newest members of the board include Stephanie Teubner, president/CEO, Warren FCU, Cheyenne, Wyo., and Mark Uden, president/CEO of Mutual lst CU, Omaha, Neb. Teubner was elected to a three-year term while Uden's term will be one year. Officers voted in:
* Chairman, Carla Hedrick, president/CEO of Denver Community FCU; * Vice Chair, Cowling; and * Secretary/treasurer, C. Michael Litzau, executive vice president of corporate at Sooper CU, Denver.
Sixty-four representatives of more than 37 member credit unions attended.

Michigan PAC ranks in states Top 25

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PLYMOUTH, Mich. (5/13/08)--The Michigan Credit Union League’s (MCUL) political action committee, ranks 22nd among state political action committees for the 2008 election cycle, the league said this week. The Michigan Credit Union League Action Fund raised $212,851 from January 2007 through mid-April 2008, according to data released by the Michigan Campaign Finance Network. The figure is a 41.3% increase compared with the same time period last year (Michigan Monitor May 12). “Interestingly, more than one-third of the state’s top 150 political action committees are actually down in their fundraising from the previous election cycle,” said MCUL Executive Vice President Patrick La Pine. “This could be a reflection of the state’s weak economy, but it also underscores the remarkable achievement of Michigan credit unions.”

CUs letters debate reasons for conversion attempt

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ODESSA, Texas (5/13/08)--Although a recent attempt by a Texas credit union to convert to a mutual savings bank was dropped, a debate on whether a credit union should convert to a bank still lingers in a public forum in the Odessa American. The latest to weigh in on the issue is a small Odessa, Texas-based credit union. Louise Smith, president of $7.3 million asset Permian Basin CU, wrote the letter in the Odessa American's online forum (May 10). The letter responded to a letter published earlier and written by Shem Culpepper, CEO of First Basin CU. The $115 million asset, Odessa-based credit union had planned to convert to a bank before dropping the proposal after a membership group opposed it. Culpepper's letter noted that the credit union cited "harsh business lending restrictions as one of the key reasons for the need to convert" (Odessa American April 19). The credit union's limit on business loans is $16 million while a mutual savings bank limit is $72 million, he wrote. In her response, Smith said First Basin currently has $5.3 million in business loans and has room to grow. It could triple them before hitting the cap. First Basin grew 13% in assets during first quarter 2008, she said, adding that at that rate, the credit union could add $7 million a year in business loans to its portfolio. "Credit unions serve a vital purpose in our community, which is very different than that of a bank," said Smith, adding that one need only to look at credit unions to see pioneering spirit. For the complete letters, use the resource links.

CU helps build young CU advocates with grant

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SANTA ANA, Calif. (5/12/08)--Orange County's CU helped turn 14 young people into peer trainers, financially aware consumers and credit union advocates, with help from a community service grant from the Richard Myles Johnson (RMJ) Foundation.
Long Beach, Calif., and state Sen. Alan Lowenthal (D-27) recognized Orange County's CU (OCCU), the Richard Myles Johnson (RMJ) Foundation, Long Beach Community Hispanic Association (Centro CHA) and its Latinos Investing for Tomorrow (LIFT) program at the graduation of 14 new peer trainers/credit union advocates. From left: OCCU's Maria Haq, Long Beach branch manager, and Leticia Mata, assistant vice president of community and education development; Jessica Quintana, Centro CHA executive director; and Tena Lozano, RMJ Foundation executive director. (Photo provided by Orange County's CU)
The $15,000 grant from RMJ--the state foundation for credit unions in California and Nevada--helped expand the Santa Ana-based credit union's partnership with Long Beach Community Hispanic Association (Centro CHA) for its Latinos Investing for Tomorrow (LIFT) program. The program aims to turn young people living in impoverished communities in the Greater Long Beach area into peer trainers in their communities. It includes a financial literacy component developed by the credit union. Some of the funds went to providing $500 stipends for each of the 14 graduates, aged 16 to 22. They attended six workshops on Saturdays to learn how to be active and informed advocates in their home, school and community. The financial literacy component included instruction on budgeting, the value of money, the value of credit, and saving and investments. Participants also completed 40 hours of community service and took field trips, including one to a local branch of the $861.6 million asset credit union. After the field trip, the new advocates spread the word about the credit union difference, which resulted in the opening of 27 new accounts, said Leticia Mata, assistant vice president of community and education development at the credit union.

Membership growth Family Trust FCU

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ROCK HILL, S.C. (5/12/08)--Planning for membership growth strategically and budgeting for it are two key components of realizing steady sustainable growth, according to the CEO for Family Trust FCU. The $205.7 million asset Rock Hill, S.C.-based credit union has had more than 20% growth in membership over the past two years--12.5% in 2006 and 8% to 9% in 2007, Family Trust President/CEO Lee Gardner told News Now. News Now is introducing its Focus on Growth weekly series of interviews with fast credit union growers this week as part of an initiative of the Credit Union National Association (CUNA) Membership Growth Task Force. The series focuses on fast "organic" membership growth, not growth by merger or indirect loans. The task force, chaired by Dick Ensweiler, president of the Texas Credit Union League, was convened at the request of CUNA’s Immediate Past Board Chair Allan Kemp McMorris. Its purpose is to investigate, report on, and encourage credit unions to embrace opportunities, techniques and processes that will increase credit unions' membership retention and growth. Family Trust plans strategically for growth and also budgets for it, Gardner said. “We want to grow large but feel small,” he explained. “We budget annually for 7%-14% growth. We state this in our strategic plan. It’s a statement to our employees and board of directors to set a target.” Also, Family Trust does not sit on its capital; it spends it, Gardner said. “We have a 9.2% net worth ratio. Some credit unions have 16%-18% capital. Why not spend that money to grow?” he said. It’s also important for a credit union to have a good relationship with its board or directors and have the board be active in the credit union’s strategic planning process, he added. The driving force behind the credit union’s growth is that it has an extremely strong community brand, which helps it build relationships in the community, Gardner said. “It’s hard to differentiate yourself in the market on just products and price anymore,” he explained. “We differentiate by our presence in the community. We do good things in the community, support it and then we publicize what we do.” One mistake that some credit unions make is it they don’t have a differentiation strategy, Gardner said. “Ours is that we are good people, we do good things in the community, we do the right things for our members and our employees,” he said. “You can’t just be good on Sunday and bad during the week.” Family Trust strategically builds its branches, using the “Blue Ocean Strategy” by going into quiet areas, not necessarily “hot spots” where everyone else goes. The credit union looks to build its branches by looking at schools, roads and housing areas, Gardner explained. “We’re opening a branch in September where there are no credit unions, but there is housing there, and it is located about a quarter-mile between two schools,” he said. “We develop the soft spot or gap. We go to where we can develop a value proposition and new business.” Part of Family Trust's growth strategy is to get members while they’re young and develop a long-term relationship with them. About 26% of the credit union’s membership is age 25 or younger, Gardner said. The credit union sponsors a youth week and a weeklong program twice a year called “Real Life, Real Money” in which teens are educated about financial matters. The teens are encouraged to open checking accounts and are familiarized with debit cards, and other financial products and services. “A key to growth is to have a young leader--under age 30--who brings in innovation and perspective to your credit union,” Gardner said. A mistake that some credit unions make is that they don’t have young people in leadership positions to bring in innovation.” Another key facet of the credit union’s growth is the implementation of relationship pricing with member loans and deposits. The more credit union services that members use, the better the interest rates they receive. The rates are based on a formula taking into account a member’s use of checking accounts, debit cards, credit cards, and e-statements (which save the credit union on paper costs). “Our rates are based on services that members use, not just their credit history,” Gardner explained. “This equips our frontline services staff to inform members that they can get a better rate on a loan if they have a Family Trust debit card, credit card or checking account.” Family Trust has been a community credit union since 2000, serving people who live in York County, S.C. It became a community credit union because there were not enough companies in the area to serve on a select employee group basis. “As a community credit union, we can compete at the individual member level rather than the corporate level,” Gardner concluded. Anyone who wants to contact the CUNA Membership Growth Task Force can e-mail the account established for this purpose at CUNAMGTF@cuna.coop.

Refis home loans booming for Service CU

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PORTSMOUTH, N.H. (5/12/08)--A local New Hampshire credit union has managed to avoid losses caused by a struggling housing market and experienced by the rest of the U.S. Service CU, Portsmouth, has had three times this year the volume in new loans it had last year, especially in refinancing, Fawn Terwilliger, Service CU vice president of lending told Fosters.com. Service CU also saw an 80% increase in new loans over those in 2007, she added. Industry experts predict that the weaknesses in the housing market will prevail. On Tuesday, Fannie Mae reported that it lost $2.2 billion loss during the first quarter of 2008. Fannie Mae, which maintains the secondary market in mortgages, attributed the losses to defaulted loans and foreclosures. To offset losses, Fannie Mae plans to increase its capital by $8 billion, the Office of Federal Housing Enterprise Oversight (OFEHO) said this week. OFHEO is Fannie’s regulator. The increase in capital could help first-time home buyers, Dean Christon, executive director, New Hampshire Housing and Finance Authority, told Fosters.com. Credit unions largely sidestepped the mortgage crisis, because typically they do not make subprime loans, according to Bill Hampel, Credit Union National Association chief economist (News Now April 28).

N.Y. league small CU planning project in third year

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LATHAM, N.Y. (5/12/08)--For the third year in a row, the New York State Credit Union League initiated its Making the Strategic Connection program for small credit unions with a meeting of 12 credit unions newly chosen to participate.
Management Consultant Marge Kazz (standing) works with representatives from four of the 12 credit unions participating in the New York State Credit Union League’s program to help small credit unions with strategic planning. (Photo provided by the New York State Credit Union League)
The program, launched in 2006, was designed to assist small-asset-size credit unions with their strategic planning. It is funded by a grant from the New York Credit Union Foundation. The program was expanded this year to include applicants with under $20 million in assets. Last year, the program included credit unions with less than $10 million in assets. A number of New York credit unions have participated in the program, which includes strategic planning workshops, development of a marketing plan and corresponding budget, and a financial forecast. A league management consultant reviews each credit union’s forecast to help it stay on track and avoid pitfalls that may arise along the way. “The Making the Strategic Connection program is an essential management tool, which results in the creation of an effective strategic plan,” said Marge Kazz, league management consultant. “It not only sets the future course of the credit union, it sets the environment in which it operates.”

Auto loans declining at CUs says corporate

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DALLAS (5/12/08)--During first quarter 2008, credit unions' vehicle loans outstanding declined at a 6% annualized pace, compared with a decline of 2% for the same period a year earlier, says Southwest Corporate Investment Services. Those loans increased less than 1% during all of 2007, Brian Turner, director of advisory services, said in LoneStar Leaguer (May 9). "The teetering economic climate and lack of meaningful auto-manufacturer incentive programs so far this year hasn't helped," Turner said. 2008 should be brighter. "We are about three years out of the massive 2005 auto manufacturers' employee discount pricing incentive program that helped to produce a 9.5% annualized growth rate for credit union vehicle loans outstanding," Turner said. "However, it also oversaturated the market, after which vehicle loan growth has only increased 3% the past two years combined, or less than half the 10-year average growth rate of 6.7%," he said. The average new-car rate for 60 months was 7% at commercial banks, 4.19% at finance companies and 6% at credit unions, he reported. Overall total vehicle sales dropped 7.8% year-over-year from 2007, largely because of a 14% decline in truck sales, which typically account for roughly 51% of sales. Car sales are down less than 1% from 2007. Turner noted that high gasoline prices, weak consumer confidence and tight credit are hitting the auto industry hard. First-quarter results are traditionally the weakest sales of the year for the industry, but the seasonal adjustment still points to some weakness, said Turner's report. Credit union share of the $944 billion revolving credit market was 6%, compared with commercial banks' 66% (excluding securitized assets).

Phishing attempts rose worldwide in April

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BEDFORD, Mass. (5/12/08)--U.S. credit unions accounted for 36% of U.S. banking brands that were attacked during April by phishers attempting to secure personal financial information, according to statistics from RSA Anti-Fraud Command Center. Regional U.S. banks also accounted for 36% of the phish attempts, while nationwide U.S. banks were targets in 28% of the attacks. U.S. banking brands continued to lead as phishing targets, accounting for 62% of the attacks online. Together banks and credit unions formed more than two-thirds of the entities targeted during the month, said RSA. The number of brands attacked totaled 215, a slight decrease from March's 225, which was the highest number of brands attacked in the past year. More than 30 new financial entities were subjected to attacks during April. The U.S. continued as the leader in hosting the largest number of attacks; however, the U.S. percentage decreased 12% to 51% of hosted attacks. China was the second-largest host, with 19% of all attacks. AFCC noted that Zeus Trojan (also called "wsnpoem") attacks on financial institutions worldwide have increased. Because the package is easier to use, it can be easily controlled by unsophisticated users. Phishing incidents spread into the Asia-Pacific region, with attacks increasing in Australia and New Zealand during both March and April.

CU System briefs (05/09/2008)

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* ARVADA, Colo. (5/12/08)--Colorado State Rep. John F. Soper (D-34), center, received the John Sheehey Award at the Credit Union Association of Colorado's (CUAC) annual meeting last week in Colorado Springs. The award is given to state legislators who demonstrate outstanding support of credit unions in Colorado. Shown with Soper are, from left, Timothy Dore, senior vice president of government affairs, and John Dill, president/CEO, both of CUAC. In congratulating Soper, Dill said, "Credit union issues are bipartisan in nature, and by working actively with political leaders such as Rep. Soper, credit unions can foster a better regulatory and business environment for our long-term growth." (Photo provided by Credit Union Association of Colorado) … * Charlotte, N.C. (5/12/08)--Charlotte Metro CU is expanding its services to include business banking, including basic and premier business checking services, the $152 million asset credit union announced Thursday. Its "Business Basic Checking" pays a fixed-interest rate and offers a low $5 monthly maintenance fee, which is waived on accounts with $2,000 or more on balance. Premier checking will offer tiered interest rates. Nicol Morris has been named as chief operating officer, responsible for rolling out the business banking program and supporting sales and service. Morris has more than 16 years' experience, including regional senior vice president, with Sandy Springs Bank … * ASHEVILLE, N.C. (5/12/08)--Premier FCU raised nearly $50,000 in two months to benefit a 3-year-old with acute lymphoblastic leukemia (ALL). Paxten Mitchell, who lost his battle with ALL on April 6, was a member of the credit union and son of Asheville firefighter/city employee Robert Mitchell. The Mitchell family's insurance company would not pay for Paxten's treatment at Duke University Medical Center, so the credit union began fund raising to help. The insurance company's denial sparked widespread media coverage in the area, with mentions of the credit union's collecting donations. The donations enabled Paxten to begin treatments in March, but they were discontinued when they stopped working. Eblen Charities in Asheville, which is helping the family pay hundreds of thousands of dollars in medical costs, will receive the more than $47,000 donations raised through Premier … * PHILADELPHIA (5/12/08)--"Leave It to Beaver" actor Jerry Mathers, who turns 60 this year, was on hand to help American Heritage FCU, Philadelphia, celebrate its 60th anniversary at the $646.5 million asset credit union's annual Member Appreciation Day event April 26. Mathers was available for photos with members and signed autographs. Members also received a Colorado blue spruce seedling to help them "Go Green," reported the Pennsylvania Credit Union Association (Life is a Highway May 9) …

CUAC elects new board members

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ARVADA, Colo. (5/12/08)--The Credit Union Association of Colorado (CUAC) announced the election of its new board members. The following will serve in leadership positions on the CUAC board:
* Chairman: Doug Ferraro, president/CEO, Bellco CU, Denver; * Vice Chairman: Mike Williams, president/CEO, Colorado State CU, Denver; * Treasurer: Keith Cowling, president/CEO, Credit Union of Denver; and * Secretary: Eva Gaudio, president/CEO, St. Vrain Valley CU, Longmont.
Additional board members include:
* Charles Emmer, president/CEO, Ent FCU, Colorado Springs; * Sundie Seefried, president/CEO, Eagle Legacy CU, Arvada; * Lynn Sutton, president/CEO, SunWest Educational CU, Pueblo; * John Uchida, president/CEO, Space Age FCU, Denver; * Bill Becker, president/CEO, Sunrise CU, Loveland; and * Steve Pearson, president/CEO, Fellowship CU, Lamar.
Retiring from the board is Carla Hedrick, president/CEO, Denver Community CU. Replacing her is new board member Becker.

Governor to Ohio CUs Keep making a difference

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COLUMBUS, Ohio (5/9/08)--Ohio’s credit unions provide vital financial services and help to millions of Ohioans to realize their dreams of home ownership, maintain a healthy family and sustain a sound budget, said Ohio Gov. Ted Strickland.
Gov. Ted Strickland (center) at the Ohio Credit Union System ZENITH08 conference with Ohio Credit Union League General Counsel John Kozlowski and Department of Commerce Director Kim Zurz. (Photo provided by the Ohio Credit Union League)
His remarks were made at the opening session of the Ohio Credit Union System ZENITH08 conference held April 24-25 in Columbus (eLumination May 8). Nearly 800 attended. Strickland acknowledged the importance of credit unions in the financial services marketplace. He thanked Ohio credit unions for offering fair financial services, payday lending alternatives and financial education, which “make my life as governor easier,” Strickland said. Strickland also helped kick off the culmination and celebration of the 2008 Ohio Credit Unions: Marching Mile for Miracle Kids, which supports children’s hospitals in Ohio.

Pew project pushes account standards for underserved

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WASHINGTON (5/9/08)--A new project aimed at helping U.S. workers who are underserved by mainstream financial institutions was announced Wednesday by The Pew Charitable Trusts. The Pew Safe Banking Opportunities Project is designed to help workers secure access to safe, affordable, fair and empowering bank and credit union accounts (PR Newswire May 7). The two-year, $2.1 million initiative will develop and promote standards for the accounts so that moderate-and low-income households that are new to, or have been left out of, the mainstream banking system are less likely to rely on overly expensive, income-stripping financial products. The project will develop standards for bank accounts, promote their voluntary adoption by credit unions and banks, and educate the public about the standards. It also will work with industry representatives, state and local governments, consumer advocates, and personal finance experts to develop and promote the standards. “The three core principles that will guide the development of the standards are clarity, consent and fairness,” said Shelley Hearne, managing director, Pew health and human services. “For too long, millions of households that lack a basic bank account have had to rely on expensive check-cashing establishments.” Credit unions and banks that adopt the standards will be eligible to use a logo that will help consumers know the product is safe.

CU System briefs (05/08/2008)

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* ST. LOUIS (5/9/08)--The Missouri Credit Union Association (MCUA) has sponsored a series of white papers about the subprime mortgage industry and its impact on Missouri consumers (CourierNet May 7). The state ranks fifth in the nation in mortgage delinquency rate and foreclosure rates are skyrocketing. While credit unions aren't part of the subprime mortgage problem in the state, they can be part of the solution, said MCUA. Authors of the papers are Robert O. Weagley, Personal Finance Department chair at the university of Missouri, and Nancy Pierce, president, Tipton Research Group. Pierce is former CEO of Mazuma CU and former board chairman of the Credit Union National Association. The papers discuss the state's situation, the impact on its consumers and credit unions, and how credit unions can assist consumers … * BIRMINGHAM, Ala. (5/9/08)--Bob Steensma, president/CEO of Five Star CU, Dothan, has been seated as the newest member of the Alabama Credit Union League's Board of Directors, reported the league. He has served as president/CEO of the $152 million asset credit union since July 2007. Prior to that, Steensma served as president/CEO of Georgia Heritage FCU, Savannah, Ga. He has 21 years' experience with credit unions. Steensma was elected to a four-year term … * ARVADA, Colo. (5/9/08)--The Credit Union Associations of Colorado and Wyoming (CUAC and CUAW) have hired two new staffers--Andrew Guthrie and Debra Larrabee. As the new association consultant, Guthrie will serve as liaison among credit unions, state and national supervisory authorities, and the association and its affiliates. He has worked for eight years in a variety of positions, including overseeing branch operations, at Elevations CU, Boulder. Larrabee serves as the government affairs administrator and works with the associations' government affairs department to help facilitate daily operations of the team. She has more than 20 years' experience in office administrative support at divisional and local levels and was an administrator for CUNA Mutual Group for more than 10 years... * LEVIS, Quebec (5/9/08)--One in three of Quebec residents--roughly two million people--use Desjardins AccesD internet and telephone services for financial transactions. Desjardins, the largest financial institution in Quebec, is the largest integrated cooperative financial group in Canada. During 2007, members carried out 672 million transactions, a 14% increase from 2006. Desjardins holds 56% of the market share for an area surveyed by NETendances 2007 (Canada News Wire May 8) … * ST. PAUL, Minn. (5/9/08)--A former city employee of St. Paul--who admitted stealing more than $34,000 in coins from parking meters--was sentenced to 90 days in jail and 10 years of probation, and ordered to pay restitution of between $25,000 and $62,000. Vincent Schettner, 63, pleaded guilty in March to one count of felony theft of public funds. He was arrested after a teller at City & County CU told an off-duty police officer that a member regularly deposited large amounts of coins. Schettner deposited $1,000-$1,500 a week and received $800-$900 cash back. The final amount of restitution will be determined by probation officials (Star-Tribune May 3) …

WOCCU young peoples scholarship deadline is June 2

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MADISON, Wis. (5/9/08)--The deadline for the World Council of Credit Unions (WOCCU) Young Credit Union People (WYCUP) Scholarship program is June 2. Applicants must submit their completed nomination materials by the deadline. Scholarship winners qualify for an all-expenses-paid trip to WOCCU’s 2009 World Credit Union Conference in Barcelona, Spain. WOCCU said the organization is committed to ensuring the future sustainability of the international credit union system by recognizing and promoting its next generation of leaders. The WYCUP Scholarship Program seeks individuals 35 years of age or younger who already have made significant contributions to the development of their own credit unions, regional or national credit union systems, and who have demonstrated the potential to employ their talents at the international level. WOCCU member credit unions and organizations can nominate their candidates to compete for the WYCUP Scholarship. To be eligible for the scholarship, nominees must:
* Be sponsored by their credit union or credit union organization to attend WOCCU's 2008 World Credit Union Conference in Hong Kong in July; * Be 35 years of age or younger as of Jan. 1, 2008; and * Submit a completed nomination form and supporting materials to WOCCU by June 2.
The WOCCU scholarship will be awarded to five recipients at the 2008 conference in Hong Kong. WYCUP nominees will be recognized formally in Hong Kong. They will be invited to take part in events, including a networking session organized specifically for those who are 35 years of age and younger. They also qualify for a discounted registration fee.

NCBA Celebrate co-op principles as a business advantage

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COLUMBUS, Ohio (May 9, 2008)--Credit unions need to celebrate their cooperative principles, which represent a significant business opportunity in a world in which people are yearning for something with which to connect. Paul Hazen, president/CEO, National Cooperative Business Association, delivered this message as a keynoter at the Ohio Credit Union System ZENITH08 conference, held April 24-25 in Columbus (eLumination May 7). “While the cooperative model isn’t perfect, it’s better than all of the rest,” Hazen said. Credit unions and other cooperatives must ensure that their unique principles are put into action every day to deal with an increasingly complex and competitive business world, he added. Fellow keynoter Carol Schillios, businesswoman, humanitarian and winner of credit unions’ highest honor--The National Credit Union Foundation’s 2007 Herb Wegner Award for Individual Achievement--emphasized Hazen’s point by sharing her experiences of putting credit unions’ cooperative principles to work in some of the world’s neediest countries. “Credit unions are the only financial institution exporting democracy,” Schillios said. “People who can’t say anything [due to political or social situations] can have a voice in their credit union. The power of decision is afforded to anyone.”

Pa. assembly bill would authorize CUs land purchase

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HARRISBURG, Pa. (5/9/08)--The Pennsylvania House is considering a bill that would authorize the Pennsylvania State Department of General Services to grant land in Susquehanna Township to Pennsylvania State Employees CU (PSECU). The 47-acre parcel of land would be used for PSECU’s headquarters and would cost about $3 million. PSECU’s current headquarters is located on 10 acres in Harrisburg. The State Senate approved the transaction last December (News Now Dec. 12, 2008).

Self-Help plans to buy foreclosed homes

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CHARLOTTE, N.C. (5/8/08)--A community development organization affiliated with Self-Help CU in Durham, N.C., is working to stabilize a troubled Charlotte neighborhood, Peachtree Hills, by purchasing, improving, and re-selling its foreclosed homes. The program is being implemented by the credit union's development entity, Self-Help Community Development Corporation. Its financing is through the Self-Help Ventures Fund. Self-Help CU is an entity under the Self-Help umbrella but not directly involved in the initiative. The program aims to “help a neighborhood that should not be in such distress,” Evan Covington-Chavez, Self-Help CU director of real estate development, told News Now. If Self-Help’s program works, the city of Charlotte will not have to invest in a long-term revitalization project for the neighborhood. The city already has such projects in several downtown neighborhoods. Peachtree Hills was built five years ago. Despite its youthful age, it “looks like an older neighborhood,” Chavez said. Peachtree homes originally were sold for about $100,000. Now, the foreclosed properties are valued at about $70,000. The vacated homes also have been easy targets for vandals. “There are windows broken and doors beaten in,” Chavez said. Self-Help hopes to purchase up to 25 of the foreclosed properties, although the exact number will depend on market circumstances. It also plans to offer a lease-to-purchase option for potential homeowners after the homes have been fixed up, Chavez said. Although it’s still early, Self-Help hopes to “see the effects of acquiring properties in the neighborhood” within a year, she said. Self-Help plans a ribbon-cutting ceremony for the program this summer.

CU exec NACHA urge e-payments to cut fuel postage costs

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HERNDON, Va. (5/8/08)--A credit union executive who is chairperson of a working group for NACHA--The Electronic Payments Association--is urging consumers to employ electronic bill payment to mitigate rising fuel and postage costs. "Now is the time to start using electronic payments," said Lisa Monroe, electronic payment systems manager at $1.029 billion asset Evangelical Christian CU, Brea, Calif. Monroe is chairperson of NACHA's Marketing Management Group (Business Wire May 6). She told consumers, "The sign-up process, either with your financial institution or with the companies that send you bills, is simple and fast. Once you sign up, you can start enjoying the savings of time and money immediately." NACHA said a single household with an average of 20 bills and financial statements each month can spend up to $100 on postage each year and another $50 on the cost of checks, late charges and fuel used to mail their payments. Monroe also noted in a press release that with electronic payments, "far fewer people touch your personal financial information. The payments travel security to the companies that send you bills. It's the most private way to pay bills." A recent study by Javelin Research and Strategy indicated that most identity thefts start with someone seeing a victim's personal financial information on a check, billing statement on bank account statement. In April, PayItGreen Alliance announced that a family could save nearly seven pounds of paper a year by switching to electronic bills, statements and payments. If one in five families in the U.S. switched to electronic payment services, they would save nearly 103 million gallons of gasoline--equal to 1,000 road trips from New York to Los Angeles and back.

New York CUs lobby for depository choice

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LATHAM, N.Y. (5/8/08)--Representatives from New York credit unions and the New York State Credit Union League recently gathered in Albany, N.Y., to advocate for depository choice.
Robert Nemeroff, Melrose CU, Briarwood, talks about depository choice with New York State Rep. Herman “Denny” Farrell (D-Metropolitan). (Photos provided by the New York State Credit Union League)
Currently, commercial banks are the only banking institutions in New York state that are permitted to accept deposits from local and state governmental units. “The law addressing municipal funds was enacted in 1909,” said William J. Mellin, league president/CEO. “Credit unions did not exist in New York 100 years ago. Clearly it is time to fix this antiquated law and allow municipalities the depository options they are seeking.” Bills in the state Senate and/or the Assembly that would secure depository choice for credit unions include:
* S.3664, sponsored by State Sen. Kevin Parker (D-Metropolitan) and A.6511, sponsored by State Rep. Carl Heastie (D-Metropolitan), would allow state and federal credit unions, savings and loans, and federal savings associations to accept municipal deposits; * S.4054, sponsored by State Sen. Hugh Farley, (R-Capital) and A.6856, sponsored by State Rep. Catherine Nolan, (D-Metropolitan), would allow state and federal credit unions and savings banks to accept municipal deposits; and * S.4071A, sponsored by State Sen. John Flanagan (R-Long Island) and A.7322A, sponsored by State Rep. Harvey Weisenberg (D-Long Island), contains a local option in which the local governing body would designate the financial institution by resolution. It also limits the amount that each depository financial institution can accept for deposit at $1 million per municipality.
The group of 16 credit union professionals met to review the pros and cons of each of the bills before heading to the State Capitol and legislative offices to visit 19 legislators, including bill sponsors and chairmen of key committees.
From left: Bruce Beaudette, Sunmark FCU, Schenectady; William J. Mellin, New York State Credit Union League; New York State Sen. Hugh Farley (R-Capital/Adirondack); Michael Castellana, SEFCU, Albany; and Tristam Coffin, Alternatives FCU, Ithaca.
During the meetings, the group reiterated how credit unions play a vital role in the state economy, how they are regularly approached by representatives from their local fire departments, libraries, schools and villages, and how--as required by current state law--they must turn away the business. The group said municipalities facing tight budgets could see financial benefits from working with credit unions, and their taxpayer’s funds would stay local, benefiting their communities. After their visits, credit unions and lawmakers met for a legislative reception. “As commercial banks deepen the credit crisis, government leaders need to explore more local, responsible and affordable financial services options,” said Amy Kramer, league vice president, governmental affairs. “Our targeted visits provided the opportunity for New York credit unions to convince lawmakers that their communities and constituents would greatly benefit by allowing local government access to credit unions.”

Taylor reappointed Southwest Corporate Chairman

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PLANO, Texas (5/8/08)--Brent Taylor, president/CEO of Weokie CU in Oklahoma City, Okla., has been reappointed as chairman of the board for Southwest Corporate FCU, Plano, Texas. The appointment was made at an organizational meeting held in conjunction with Southwest Corporate’s 33rd annual meeting (eFACTS May 6). Taylor has served on Southwest Corporate’s board of directors since 1998. He has been CEO at Weokie CU since 2007 and has served on the credit union’s management team for 18 years. He is a member of the Credit Union Executives Society and a former director of the Oklahoma Credit Union League. Also Jessie Gutierrez, Texas Bay Area CU, Pasadena, Texas, was appointed Southwest Corporate vice chairman; and Claudia Green, El Paso Teacher FCU, El Paso, Texas, was appointed Southwest Corporate secretary.

Steve Ford addresses Maine leagues convention

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PORTLAND, Maine (5/8/08)--Steve Ford, son of the late President Gerald Ford, addressed the Maine Credit Union League’s Annual Meeting and Convention as the keynote speaker last weekend in Portland.
Steve Ford, son of President Gerald Ford, addressed the Maine Credit Union League’s Annual Meeting and Convention in Portland, Maine.
About 82% of Maine’s credit unions were represented by roughly 650 attendees. This year’s theme was “Maine Credit Unions--70 Years of Giving Back.” “Through leadership and commitment and by working together, the Maine Credit Union League and Maine’s credit unions have a strong record of giving back for more than 70 years, and we’ll continue to give back to members and the community in a variety of ways for years to come,” said John Murphy, league president. Ford spoke about the importance of leadership, overcoming adversity, living with values and character, settling and juggling priorities, and making the right decisions, the league said. “Seven years ago, I was challenged by three people in my life to do something inspiring and to work to make a difference,” Ford said.
Rep. Mike Michaud (D-Maine), the nation's only credit union board member currently in Congress, addresses the Maine Credit Union League's Annual Meeting and Convention.
“I took time off from acting and other activities and traveled to places like Africa and saw poverty, hunger and tragedy, but my travels inspired me because the people in these places had a great attitude and hope.” Several legislators also spoke at the event. Rep. Mike Michaud (D-Maine) praised credit unions “for always putting the best interests of their members first. As a credit union member, I appreciate that. Maine’s credit unions give back to their communities in so many ways, from the best deals in financial services, to financial assistance, to helping end hunger. Maine credit unions are all about people and that truly makes them special.”
Rep. Tom Allen (D-Maine) reiterated his opposition to ever taxing credit unions before an audience of Maine credit union leaders at the Maine Credit Union League's Annual Meeting. (Photos provided by the Maine Credit Union League)
Rep. Tom Allen (D-Maine) acknowledged credit unions for their community service. “I am particularly impressed by the fact that Maine credit unions contributed more than 23,000 hours of volunteer time to their communities last year, and not because you have to but because you want to,” he said. League-endorsed candidate for the First District congressional race, Adam Cote, told the audience of his lifelong membership in a credit union. “When I needed my first car loan and loans for college and other important events in my life, I have always been able to count on my credit union to not just give me a loan, but give me a better deal on a loan. “That’s what credit unions do and I have experienced it first-hand and look forward to being an advocate for credit unions in Congress. Having the support of the league means a lot to me,” he said. Maine Gov. John Baldacci and Sen. Susan Collins (R-Maine) were scheduled to speak also but cancelled due to flooding in Aroostook County.
Just days after formally endorsing him as the Maine Credit Union League's candidate in the First District Congressional Race, Adam Cote addressed attendees at the Maine CU League's Convention. Pictured (left) is Adam Cote, one of six candidates running in the June Democratic primary, and John Murphy, league president.

CU System briefs (05/07/2008)

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* MADISON, Wis. (5/8/08)--Dorian Stone, an associate principal in the San Francisco office of McKinsey & Co., a management consulting firm, has been named a Research Fellow at the Filene Research Institute. Research Fellows are researchers and professors who provide expertise on a range of topics. Stone focuses on the financial service industry across the U.S. and Latin America, and leads the firm's proprietary research and knowledge efforts on consumer buying behaviors and customer experience in the property and casualty and financial services industries. He received his MBA from the Wharton School at the University of Pennsylvania … * RALEIGH, N.C. (5/8/08)--State Employees' CU has again teamed with the North Carolina Office of State Personnel and state agencies to sponsor statewide radio messages promoting state employees and the services they provide. The messages are part of a "What's In It For You" Image Campaign that began in 2001. They are airing this week, which is also State Employees' Recognition Week. This year's radio campaign spotlights five employees and their agencies/departments. During the spots, the employees introduce themselves and comment on the services their agency provides. The campaign also highlights a website, www.whatsinitforyou.org, which links to state agencies, job listings, and information about services …

Yet another publication recommends trying a CU

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MADISON, Wis. (5/8/08)--A May 7 article in Investopedia, published by Forbes, recommends that consumers who are frustrated with banks should look at credit unions for their financial needs. In the article, “Tired of Banks? Try a Credit Union,” Certified Financial Planner Mark P. Cussen writes about the alternative value of credit unions. “Many bank customers are becoming increasingly frustrated with the litany of fees their banks are charging, as well as the difficulties often associated with obtaining a loan,” Cussen wrote. “Credit unions represent an alternative to banks and possible solutions to common complaints about traditional banking institutions.” Cussen also explains what credit unions are, their history, their regulatory apparatus and environment, the credit union philosophy, and how credit unions have higher rates, lower fees and better service than banks.

Final results Youth Saving Challenge hits 12 million

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MADISON, Wis. (5/8/08)--The National Credit Union Youth Week Saving Challenge, hosted by the Credit Union National Association (CUNA), garnered more than $12 million in savings. Youth Week took place April 20-26. Four hundred credit unions reported their results to CUNA. Total deposits equaled $12,035,272.42; 76,524 youth made deposits; and credit unions opened 6,748 youth accounts. “Credit unions proved that youth matter,” said Joanne Sepich, National Youth Week coordinator. This year’s theme was “Got Green? Grow it at Your Credit Union,” and a number of credit unions combined savings lessons with being environmentally conscious. “From digging in the dirt to face painting, credit unions opened their doors to youth and introduced them to the very simple concept of setting goals and saving for them,” Sepich said. Last year, 393 credit unions reported $10,133,355 in deposits from 71,844 young members. About 9,067 new youth accounts were opened.

Texas CEO profiled in banking publication

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SAN ANTONIO (5/8/08)--David Reynolds, president/CEO of San Antonio-based Security Service FCU, was profiled in the San Antonio Business Journal Friday. The biggest obstacle facing the financial industry is the subprime mortgage lending market crisis, Reynolds told the newspaper. Everyone has been affected by subprime problems, whether they participated in the subprime loan market or not, so his credit union is focusing on helping members touched by the crisis, Reynolds said. “We will, therefore, indirectly have to deal with it, and we are, by … trying to help them, rather than just saying, ‘Well that’s your problem. Go figure it out,’” Reynolds said in the article. “We’re here to help counsel and do what we can to get them out of these problems because it doesn’t do us any good to succeed if the community is not succeeding.” A former credit union examiner, Reynolds was acquainted with a similar financial crisis in the late 1980s and early 1990s due to a bust in the commercial real estate, oil and gas markets in San Antonio and Texas, the journal said. The $4.376 billion asset Security Service was able weather those tough times by adhering to consistent and sound lending practices, Reynolds said. The credit union is focused on growth and has been reaching out to military personnel, Reynolds told the journal. The Texas Credit Union League said a credit union profile in the publication was unusual. “Generally, business journals--weekly newspapers that focus on business stories in major metropolitan areas--are on the fences about credit unions,” Winter Prosapio, advocacy communications director for the Texas Credit Union League, told News Now. “As a general policy they don’t write about not-for-profits, and usually they give considerable space to area banks. “So when a credit union lands not only a story but a full-fledged feature, it’s an accomplishment,” she concluded.

CUNA helps CUs assist members in tough times

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MADISON, Wis. (5/7/08)--Consumers face difficult times in the economy ahead. Credit unions are stepping in to help their members weather the crisis. And the Credit Union National Association (CUNA) is supporting credit unions' efforts--with money management information. Home and Family Finance Resource Center, one of CUNA's online content services, introduced its Tough Times Series last week. The series will run until the economy turns the corner. "Credit unions are helping their members, and we're helping credit unions do that," said Jim Hanson, vice president of CUNA's center for personal finance. "We're making sure that members have access to money management information that can help them gain perspective on today's tough climate," Hanson said. Members will learn "what steps to take to avoid being a casualty in this economy." He gave examples. New articles such as "How to Handle a Layoff," as well as older ones such as "Steer Clear of Credit Counseling Bad Guys," can point members in the right direction--to the credit union--for help. At the Home & Family Finance Resource Center, "members at subscribing credit unions can search on the phrase 'Tough Times Series' and bring up several articles and tools that address current challenges," said Michelle M. Haas-Dosher, CUNA senior editor. "We will add new articles in the coming months."

Student loan social lending sites latest P2P venture

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NEW YORK (5/7/08)--More social lending websites are cropping up, with the latest batch focusing on providing student loans at a time when there's confusion in the student loan market. A credit union venture--Zopa.com--a social finance site with at least six credit union partners--plans to launch a student loan feature this summer, according to SmartMoney (April 25). At Zopa, loans are funded by the credit union partners. Investors on the site can buy certificates of deposit from the credit unions. Since the investments are insured, the borrower's payments are less than other sites (Yahoo! News May 6). Credit unions will have plenty of competition from online person-to-person (P2P) lenders. Two new sites--Loanio and GlobeFunder--have announced plans to launch this year (Yahoo! News May 6). College Loan Market, based in North Reading, Mass., plans a June start up and will bid out students' loan applications to a group of lenders, according to Boston.com (May 6). Others sites are already established, either as general lenders, student lenders, or as information sites for student loan comparisons. Among them:
* Fynanz, a New York-based P2P lender dedicated solely to student loans. It is the newest start-up and allows borrowers to create an online listing with their educational profile, along with a loan and rate request. Student can request unsecured loans from $2,500 to $20,000, to be repaid over a 10-to-20-year period (finextra.com May 6). * CollegeDegreeFund.com, a site that, like Fynanz, focuses on education debt. * Simple Tuition Inc., a Newton, Mass.-based online service that helps students and parents compare loan options. The site is on track to about two million users in 2008, but some of the lenders it works with have vanished (The Boston Globe May 6). Last year its partner lenders totaled 55; that number has dropped to 31. * Virgin Money, a Waltham, Mass.-based site (originally launched as CircleLending) that offers to formalize loans between students and their family members for $299; * Lending Club, which has a Facebook application; * Prosper, an auction-style site that connects lenders and borrowers. It probably is the most well-known P2P lending site.

Mich. lawmakers tout CUs work on mortgage crisis

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NORTHVILLE TOWNSHIP, Mich. (5/7/08)--Michigan lawmakers attending a chapter breakfast were complimentary of credit unions' efforts in finding solutions to a mortgage crisis they didn't cause.
State Rep. Matthew Gillard compliments Michigan's credit unions for their work. He spoke at the Blue Ox Chapter Legislative Breakfast. (Photo provided by the Michigan Credit Union League)
Michigan State Rep. Matthew Gillard (D-Alpena) addressed 50 credit union attendees at the Blue Ox Chapter Legislative Breakfast April 25 in Alpena (Michigan Monitor May 5). He complimented credit unions' efforts to address the foreclosure crisis, saying their efforts to address the foreclosure issue had not gone unnoticed and were appreciated. In addition to Gillard, the event drew State Rep. Joel Sheltrown (D-West Branch) and staffers from the offices of U.S. Rep. Bart Stupak (D-Menominee) and State Sen. Tony Stamas (R-Midland). According to Alpena Alcona Area CU President/CEO Donald Mills, the lawmakers heard that "the credit union industry was not responsible for the present mortgage crisis that is crippling American families and our overall economy, and that credit unions will be a vital part of the solution to this problem." He added, "This crisis was created by lenders who don't operate by the credit union philosophy of trustworthy, personal service."

WOCCUs Pete Crear awarded Polish CU System prize

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WARSAW (5/7/08)--World Council of Credit Unions (WOCCU) President/CEO Pete Crear has been named recipient of the Feniks Prize awarded by the Foundation for Polish Credit Unions, part of the Polish Credit Union System. The prize will be presented in a special ceremony June 19 at the Polish system's National Credit Union Conference. "Under the able leadership of Pete Crear, WOCCU became much stronger in the countries of Eastern Europe, putting emphasis on better utilizing Polish credit union expertise for the benefit of the movements in this region," said Grzegorz Bierecki, president of Poland's National Association of Cooperative Savings and Credit Unions. Bierecki is also WOCCU board treasurer. Crear, a former executive for the Credit Union National Association and its affiliates as well as several state credit union leagues, was awarded the Foreign Prize, one of five Feniks awards given each year. Judges for the award include CEOs, deputy CEOs and board members of the Polish credit unions' national association and foundation. Prize committee members said Crear received the honor for his continuous support and personal commitment to the Polish Credit Union System. "I have been fortunate to witness the growth of the Polish system and have long been impressed with the expertise and commitment of its chief architects," said Crear. "It's one of the world's fastest growing, most accomplished credit union systems, and I am pleased and proud to receive this prestigious honor."

DE class graduates registration open for next class

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MADISON, Wis. (5/7/08)--Twenty-one credit union executives and professionals graduated from Credit Union Development Education (CUDE) training in Madison, Wis., early last month.
Click to view larger image Twenty-one credit unions executives and professionals graduated from Credit Union Development Education training in Madison, Wis., last month. In the program, they learned about national and international credit union systems and cooperatives. The training was sponsored by the National Credit Union Foundation. (Photo provided by the National Credit Union Foundation)
Participants from throughout the U.S, Australia, Kenya, England and Scotland, learned about national and international credit union systems and cooperatives. The training, sponsored by the National Credit Union Foundation, focused on cooperative principles, social impact and credit union uniqueness as a competitive advantage in today’s marketplace. One facet of the development education (DE) training had the class divide into five work groups--each choosing a subject to research. Participants then presented their case studies that proposed credit union solutions to some modern challenges. The groups had to:
* Decide whether or not to convert a credit union into a mutual savings bank; * Develop a plan to serve the underserved in a low-income community; * Provide credit access to the people of Iraq; * Decide whether a small credit union should merge with a larger credit union; and * Determine how credit unions can rebuild the community after the fallout of the subprime lending crisis.
The overall training promoted credit unions’ social responsibility and possible areas of domestic and international development. For a list of the 2008 Spring DE Graduates, use the link. The second DE class will be held Aug. 14-20 at IslandWood, Wash. For information or to register, contact Program Director Tom Decker at 800-356-9655, ext 4274 or tdecker@ncuf.coop

Texas operating electronic closed-account notification system

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FARMERS BRANCH, Texas (5/7/08)--The Texas Credit Union League’s (TCUL) Compliance Council will host a conference call with the Texas Department of Banking May 14 to assist credit unions with any concerns and questions regarding the state’s newly implemented Closed Account Notification System (CANS). During the 80th Regular Session of the Texas Legislature, State Rep. Helen Giddings sponsored House Bill 2002 (LoneStar Leaguer May 6). It created an electronic notification system that requires financial institutions, upon proper request by a customer, to alert check verification entities that the customer has closed an account because of actual fraud or compromised financial information. To implement the program, every financial institution maintaining an office, branch or agency office in the state must register with the Texas Department of Banking, which is administering the program. The department had CANS operating March 1.

NACUSO announces director election results officers

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NEWPORT BEACH, Calif. (5/7/08)--The National Association of Credit Union Service Organizations (NACUSO) announced that Doug Petersen, CEO of Workers’ Financial Services, Fitchburg, Mass., will begin his first term serving on the NACUSO board. NACUSO held its election April 24 and announced the results April 28 during the annual meeting. Platinum Partner Vic Pantea, president and chief operating officer, Member Gateways, South Bend, Ind., retained his seat on the board. Pete Snyder, president of Snyder Consulting Solutions, Rocklin, Calif., also retained his seat on the board. Officers for the 2008 board include:
* Chair: Dave Serlo, president/CEO, PSCU Financial Services; * Vice-chair: Snyder; * Treasurer: Lisa Renner, president/CEO, CU Holding Company LLC; and * Secretary: Judy Sandberg, senior vice president of strategic direction, Gateway Services Group.

CU System briefs (05/06/2008)

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* HARRISBURG, Pa. (5/7/08)--The board of directors of the Pennsylvania Credit Union Association (PCUA) approved the purchase of Policy Pro, an online policy library with more than 200 policies on topics such as human resources, third-party due diligence, accounting issue, Bank Secrecy Act and red flags. PCUA is making the policies available to member credit unions at no charge and expects the program to become available later this summer (Life is a Highway May 1) … * BLOOMFIELD HILLS and AUBURN HILLs, Mich. (5/7/08)--A planned merger of two Southeast Michigan credit unions--$600 million asset T&C FCU in Bloomfield Hills and $600 million asset USA CU in Auburn Hills--would create the fourth-largest credit union in the state (mlive.com May 2). Combined assets would total more than $1.2 billion. The new credit union would be called Genesis, reflecting the membership roots of both credit unions--General Motors for T&C FCU and Burroughs/Unisys for USA CU. USA CU President Mary McDonald would remain with Genesis during the transition, then retire. T&C President/CEO Dianne Addington would be CEO-designate of the merged institution. The merger is pending approval by T&C members in August … * FAIRBORN, Ohio (5/7/08)--Douglas A. Fecher, right, president/CEO of Wright-Patt CU was named as "Professional of the Year" by the Ohio Credit Union League during the league's ZENITH08 conference April 24 in Columbus. Fecher is shown with Steve Behler, league chair and CEO of Kemba CU, who made the presentation. Fecher's innovations include StretchPay, a credit union alternative to payday lending that has received national and statewide attention. Fairborn-based Wright-Patt CU has doubled in asset growth since 2002. (Photo provided by Wright-Patt CU Inc.) … * HARRISBURG, Pa.(5/7/08)--Amanda Grolemund, 25, of Erie, Pa., was the winner of a statewide contest to serve as 2008 Credit Union Youth Ambassador of Pennsylvania. She represented the Erie Chapter of Credit Unions and is the marketing manager at Erie General Electric FCU. The contest was conducted during the Pennsylvania Credit Union Association's (PCUA) 74th Annual Convention and Expo. As youth ambassador, Grolemund will speak to credit union officials throughout the state at PCUA events and regional chapter meetings. First Alternate is Kathryn Berger, 22, of M-C FCU, Danville, representing the N.W. Susquehanna Chapter of Credit Unions, and Second Alternate is Christopher Owens, 24, of Pennsylvania State Employees CU, Harrisburg, representing the Harrisburg chapter … * NEENAH, Wis. (5/7/08)--Ten-year-old Emma Flottemesch of Neenah, Wis., shown here, was recognized as the 3,000th member of Neenah-based Evergreen CU and was awarded prizes. Emma's entire family are members of the credit union. The $22 million asset credit union is celebrating its 50th Anniversary this year. ECU President Sherry Johnson told Emma, "We've been waiting 50 years for you." (Photo provided by Evergreen CU)

NCBA to aid Ace Hardware owners to keep co-op structure

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WASHINGTON (5/7/08)--The National Cooperative Business Association (NCBA), which represents cooperatives across various sectors of the economy, including credit unions, announced that it will help Ace Hardware owners maintain Ace’s cooperative structure. The NCBA will help the Concerned Ace Owners (CAO) elect new directors to Ace’s board that are more representative of the Ace membership and who pledge to maintain the company as a cooperative. NCBA is asking all owners to support CAO’s slate of candidates--Brian Odell, Larry Perty, Charlie Huff and Patrick Smith. “They have reached out to all of the more than 3,000 Ace members on a shoestring budget while combating the staunch opposition from Ace’s current board and senior management,” said Paul Hazen, NCBA president/CEO. Ace consists of independent, locally-owned hardware and home improvement stores. Last August, Ace management discovered an accounting error that erased $152 million, or 47% of the company’s equity. The current board of directors created a plan to restore the equity by assessing members with a variance allocation charge, though the plan has been tabled until the equity restoration plan is completed. CAO formed to encourage Ace’s membership to be more proactive in setting the company’s future direction. More than 700 Ace owner-members have registered with CAO. Ace has stores in all U.S. states and 63 countries.

PCUA re-elects board officers presents awards

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HARRISBURG, Pa. (5/7/08)--The Pennsylvania Credit Union Association (PCUA) board of directors re-elected officers and presented awards at its annual reorganization meeting April 30. Officers re-elected were:
* Chair: Diana Roberts, president/CEO, Hershey FCU, Hershey; and * Vice Chair: Ray Brunner, president/CEO, WEST-AIRCOMM FCU, Beaver.
Roberts represents District 8 and has been a PCUA board member since 1992. She will serve as chairman of the PCUA’s nine-member board of directors for one year. Brunner represents District 2 and has been a PCUA board member since 1999. Also, at PCUA’s 74th Members Annual Meeting May 3 in Pittsburgh, the association’s Lifetime Achievement Awards were presented:
* Judi Supplee, CEO, Keystone FCU, Downingtown, received the 2008 William W. Pratt Professional of the Year Award; and * Kathy Linn, board chair, Service First FCU, Danville, received the 2008 Joseph A. Moore Volunteer of the Year Award Life is a Highway May 5).
Louise Lingenfelser, president/CEO, UGI Employees FCU, Wyomissing, was elected to PCUA’s board of directors. She will serve a three-year term.

CUNA money management program featured in article

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MADISON, Wis. (5/6/08)--A money management simulation program designed by the Credit Union National Association (CUNA) was among the programs featured in an article about programs to teach teens financial literacy through simulated situations. Mad City Money, based on a curriculum created by CUNA, was an event held at La Follette High School and Memorial High School in Madison. The event was sponsored by Heartland CU (Wisconsin State Journal May 4). Donna Kennedy, a business education teacher at La Follette, put together the program for her school and for Memorial. Another teacher, Anna D'Amelio, secured a grant for $5,000 from the Governor's Council on Financial Literacy. About 250 students participated in La Follette. They were given an occupation, salary, spouse, student loan debt, credit card debt and medical insurance payments. They visited stations staffed by volunteers posing as merchants selling housing, transportation, food, household necessities, clothing, day care and more. At the end of the event, students had to stop by the credit union booth to see if they spent their money wisely. The goal at the end was to have some money left. Kennedy said she would eventually like to get the event started at all high schools in Madison.

Biz lending at CUs scores nationwide media hits

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SAN ANTONIO (5/6/08)--Credit unions' business lending scored a major media hit last weekend with an article about nontraditional options for small business borrowers. The article, which featured statistics from the Credit Union National Association (CUNA) appeared in Business Week, AOL, CNBC.com, CNN.com, Forbes.com, and Tampa Tribune, among others. The Associated Press article tells about a man in Texas who spent a year developing relationships with three large banks, only to be abruptly denied a loan for his restaurant-microbrewery because the national economy had soured. He went to the credit union, and his loan was approved within two weeks. His microbrewery is set to open in October. Also discussed: Peer-to-peer lenders, including Zopa, an online social financier backed by partner credit unions. Zopa loaned to a self-employed photographer who needed $20,000 to publicize her company in San Francisco. She had been rejected by Capital One Financial Corp. and couldn't afford a pre-approved Wells Fargo & Co. credit line or credit card. The article cited these statistics from CUNA: Credit unions made almost $12 billion in new business loans last year. Total business loans at credit unions were $28 billion. The average size of the loans was $181,000. In the second half of 2007, almost 20% more business loans were distributed through credit unions than in the second half of 2006, CUNA said. That's despite the fact credit unions are limited by federal legislation in the amounts of business loans they can make. Other media carrying the AP article included San Francisco Gate, News-Leader, The Olympian, The Tennessean, and Arizona Daily Star. To read the complete article, use the link.

Maryland governor signs fin lit bills

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ANNAPOLIS, Md. (5/6/08)--Maryland Gov. Martin O’Malley has signed into law Senate Bill 533 and House Bill 1242, which together will lead to the formation of a statewide task force on financial literacy.
Click to view larger image At the signings of two Maryland’s bills which will lead to a statewide task force on financial literacy are: Seated from left, Lt. Gov. Anthony Brown, State Senate President Mike Miller, Gov. Martin O’ Malley, and House of Delegates Speaker Michael Busch. Standing, from left, are: Sarah Bloom Raskin, state finance commissioner; Bert Hash, president /CEO, Municipal Employees CU, Baltimore; Dana M. Stein, delegate; Dan K. Morhaim, delegate; Ann Marie Doory, delegate; James Brown, counsel for the Maryland and District of Columbia Credit Union Association (MDDCCUA); and Aaron Glaser, MDDCCUA director of legislative affairs. (Photo provided by Maryland and District of Columbia Credit Union Association)
The task force will study and make recommendations to the Maryland General Assembly on how to raise the average level of financial literacy among the citizens of Maryland, and how to promote financial literacy education within Maryland’s public schools (Focus Newsletter May 5). The signing of the bills represents a victory for credit unions, who supported both bills said the Maryland and District of Columbia Credit Union Association. The association will have three representatives on the task force, which will advocate for measures to increase financial literacy education within Maryland--an important task given the current mortgage and foreclosure crisis, the association said.

Savings accounts for Fido Kitty offered at Belco

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HARRISBURG, Pa. (5/6/08)--Now Kitty and Fido can have their own savings accounts at a credit union. Belco Community CU has introduced a pet savings account called "Belco's Critter Club." The Harrisburg-based credit union said it has the first pet savings account in Pennsylvania and it is the only area financial institution offering a savings account exclusively for pets. The accounts help pet owners save for Fido and Kitty's medical bills and other expenses. The account features no minimum balance requirements and funds are easily accessible, said Belco. Belco employees found out that 63% of homeowners surveyed have one or more pets, and that spending on pets has more than doubled in the past 19 years. Members of the Critter Club will receive discounts at local "pet partners" and will be entered for a monthly prize drawing when they deposit $75 or more. The account currently pays 0.85% annual percentage yield on balances of $5 or more. The credit union is encouraging members with more than one pet to open multiple accounts and to "name" each account using their pets' names. To promote the pet club, Belco will participate in several pet-related community events, starting with the Humane Society of Harrisburg Area's 5K Run/Walk for Animals on May 17.

Corporates walk takes unusual steps

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GREENSBORO, N.C. (5/6/08)--First Carolina Corporate CU has an unusual goal to help its employees get fit: Walk to each corporate in the country and to U.S. Central in Lenexa, Kan.
Click to view larger imageSeveral staffers of First Carolina Corporate CU--dressed in the corporate's tie-dye logo wear--are among the 28 who pledged to walk to each corporate credit union and U.S. Central as a fitness measure in First Carolina's Corporate NetWALK. (Photo provided by First Carolina Corporate CU)
Twenty-eight staffers, armed with corporate-provided pedometers to count their steps, have started the trek in the First Carolina Corporate NetWALK. They plan to walk a total 9,241 miles--that's roughly 20.3 million steps--by September. As they reach their "destination," they will receive a small memento or token of their "visit" to the corporate. As of Monday, the group has logged 247 miles and is well on the way to the first stop: VolCorp, located in Nashville, Tenn. Also, several First Carolina employees have committed to collectively lose weight totaling President/CEO David Brehmer's body weight. Each week, Brehmer and 14 staff members weigh in. Since the program began, staff has lost 20 pounds--about 9% of Brehmer. "We all know we should exercise more and eat better. But sometimes, an extra incentive or push is needed to get us going," said Brehmer. "In today's over-scheduled, on-the-go society, too many people are pushing health and fitness to the back burner."

Maine league takes measures to help flood victims

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WESTBROOK, Maine (5/6/08)--The Maine Credit Union League, with the Aroostook Chapter of Credit Unions and the National Credit Union Foundation, has launched a website to collect contributions for credit unions affected by flooding in Aroostook County, Maine. The northern portions of the county recently experienced significant flooding that resulted in millions of dollars in damage. The flooding forced many to evacuate the area, according to the league. Applications for assistance will be distributed in Aroostook County. Many credit union members have suffered significant losses and will be in need of immediate financial assistance, the league said. “The credit union movement has a strong history of responding in times of crisis, and we are hopeful that credit unions will again answer the call to help,” said John Murphy, league president. For more information, use the link.

CU System briefs (05/05/2008)

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* APPLETON, Wis. (5/6/08)--Ken Eiden, CEO of Appleton-based Prospera CU will participate on a panel next week at a national conference hosted by the Institute of American Values. It will take place May 13 in Washington, D.C. Prospera CU has gained national attention for GoodMoney, its alternative to payday lending. "We realize that payday lending is a backend solution to a much larger problem," he said. "The true solution begins with financial education and reverting back to the principles of thrift, a concept that has been embedded in the foundation of credit unions since the movement began." A new white paper, "For a New Thrift, Confronting the Debt Culture," will be unveiled at the conference. Among the topics it discusses are models of reform including regulations and the credit union movement as a solution to the debt problem … * NORTHVILLE TOWNSHIP, Mich. (5/6/08)--Former Michigan Credit Union - (League MCUL) chairman Robert L. Huston, retired president/CEO of Co-op Services CU, has been named as the recipient of the league's highest honor, the Distinguished Service Award. The award includes automatic induction into the Michigan Credit Union Hall of Fame (Michigan Monitor May 5). Huston also has served as a director of the Credit Union National Association and CUcorp, and was a driving force behind the organization of a data processing credit union service organization, CU Data Inc. He will be recognized officially at the 2008 MCUL Annual Convention and Exposition May 15-17 in Grand Rapids … * KENT, Ohio (5/6/08)--From left, Ron Moss and Bill Burns, directors of Kent (Ohio) CU, have been named as 2008 Volunteers of the Year by the Ohio Credit Union System. As part of the Ohio Credit Union League's 2008 Leadership Recognition Program, Burns and Moss were honored for 44 years of outstanding service during the league's ZENITH08 annual convention in Columbus. Both men are charter members of the credit union's board and have served as board members for 44 years (Photo provided by Kent CU) … * NORTHVILLE TOWNSHIP, Mich. (5/6/08)--Raul Alvarez, marketing director of Financial Plus CU, Flint, Mich., has been named as the 2008 recipient of the Michigan Credit Union Foundation Credit Union Community Volunteer Award (Michigan Monitor May 5). Alvarez has served on boards or committees and done volunteer work for Genesee Area Skills Center, Grand Blanc Public Schools, Fenton Public Schools, Fenton Cultural Center Corp., Whaley Children's Center, Swarz Creek Area Chamber of Commerce, Boy Scouts of America, Capitol Area United Way, Junior Achievement of Mid-Michigan, and the Ingham Regional Healthcare Foundation. The award will be presented at the Michigan Credit Union League's Annual Convention and Exposition, May 15-17 in Grand Rapids …

March CU loans fixed-rate mortgages increase

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MADISON, Wis. (5/6/08)--Not only did credit unions' loans outstanding increase during Marcy, but also fixed-rate mortgages increased 2.8%, for the largest monthly increase since June 1999, according to the Credit Union National Association (CUNA) monthly sample of credit unions.
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Credit union loans outstanding increased 0.6% in March, rising 0.8% for the first quarter of 2008. “Credit unions are picking up loan market share, as competitors tighten their underwriting standards in the wake of the subprime mortgage crisis,” said Steve Rick, CUNA senior economist. Declining during March were home equity loans (2.8%), new-auto loans (1.5%), and unsecured loans (1.1%). “Consumers are pulling back on auto purchases and auto loans,” Rick said. “Credit union new-auto loan balances declined 3.4%, the biggest drop in 10 years.” Credit union savings balances grew 1.2% in March, compared with 2.5% a year ago. Savings growth for the first quarter of 2008 was 5%, compared with 4% for the same period last year.
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“Credit union savings balances rose 5% in the first quarter, the fastest pace in five years, as the falling home process eviscerates household wealth, creating an incentive for credit union members to increase their savings,” Rick explained. Individual retirement accounts, money market accounts and regular shares rose 4.7%, 3.8%, and 1.7%, respectively. Share drafts declined 3.3% during March. The largest year-to-date growth by account type was in the money markets accounts--rising 8%. Credit unions’ loan-to-savings ratio decreased to 80.1% in March from 80.6% in February. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--remained at 21%. Regarding asset quality, credit union 60-plus day delinquencies were 0.97% in March, a slight decrease from 0.98% in February 2008. “Delinquency rates have leveled off below the 1% level, highlighting the fact that the credit crisis has not adversely affected credit unions to the same degree as many other lenders,” Rick said. With the increase in assets, the movement’s overall capital-to-asset ratio remains at 11.1%. The total dollar amount of capital ended the year at $90 billion, an increase of 0.8% from February.

White papers focus on biz services Net Promoter Score

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MADISON, Wis. (5/6/08)--Credit unions can learn how to use business services to build member relations, and about a new tool used for analysis and benchmarking purposes to measure customer loyalty in two new white papers from the CUNA Operations, Sales and Service (OpSS) Council. “Taking Care of Business Members: The Case for Business Services as a Relationship-Building Strategy” illustrates how credit unions can grow with their business members and establish a two-way conduit to their personal and business accounts. Using case studies, expert advice, and surveys, the white paper explains how credit unions are making the most of business services opportunities and examines the successful strategies of some credit unions that are just getting started in business services. It also details how credit unions are overcoming challenges involving staffing, training, technology, competitive positioning and regulations. Net Promoter Score (NPS)--used to analyze, benchmark and measure customer loyalty--is gaining popularity within certain industries. Given the importance of the consumer “experience” and the spread of customer opinions via word-of-mouth, blogs, and online social networking sites, NPS may prove a replacement of outdated customer satisfaction surveys, which have become long and costly, said the paper. The second white paper, “Net Promoter Score in Action,” describes the score’s framework and how it is used at three credit unions. The paper begins by explaining how the score works, what drives the numbers and the rationale behind NPS. It then moves on to credit unions that use NPS to improve member stickiness and referrals, as well as their chances for survival in the competitive financial services market. The paper also provides examples of how some credit unions are tying improvements in NPS to overall employee benefits and using NPS as a jumping off point for other feedback innovations. CUNA Council members are entitled to complimentary copies of white papers. Non-members may purchase the white papers for $50 per copy.

Tornado winds cracked windows of Virginia CU branch

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COLONIAL HEIGHTS, Va. (5/6/08)--One credit union is counting itself lucky in the wake of last week's tornado spree in Suffolk and Colonial Heights, Va. Winds from the storm cracked the windows of the Southpark branch of Virginia CU, but no one was hurt. Seven members were in the lobby and five were at drive-through windows at the Southpark branch of Virginia CU when the tornado hit a nearby shopping center in Colonial Heights at about 3:30 p.m. April 28. About the same number of employees were in the branch at the time. "They heard the wind and went to the center of the branch and took cover there," said Jean Holman, senior vice president of marketing at the Richmond-based credit union. Those still in their cars ducked down. "The force of the wind cracked several windows in the branch," she told News Now. However, because the windows are double paned the wind did not get into the credit union. The tornado "was very close" to the credit union, Holman said. News accounts of the day described a funnel cloud "on its way toward the credit union." One of the stores had gravel on its roof. Rocks and other debris were blown against the windows of cars in the credit union's parking lot. Some car windows burst. Both outside ATMs were damaged but were running again by the next evening. The credit union closed about an hour early because the utilities and the computer server were out of commission. There was so much debris and glass in the parking lot, it wasn't safe to drive in, and some areas were restricted, Holman said. The credit union opened two hours late, at 11 a.m., the next day. The electricity was back, but the PC servers weren't operating. Still, the credit union was able to serve its members. The credit union put into effect its business continuity plans and the employees operated the credit union offline. "We were very fortunate to have the CU Service Centers shared branch outlets. We were able to direct members to the closest shared branches," Holman added. Stacey Carmichael, the branch's manager, noted that, "At ll a.m., when we opened, anyone coming to the branch never would have known that anything had happened the day before. Every one was very supportive and everything went very smoothly." "We were so glad no one was hurt and that everyone, even members at the drive in, was OK," Holman said.

CUNA Mutual opens European headquarters in Dublin

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DUBLIN, Ireland (5/6/08)--CUNA Mutual Group’s International Division announced an expansion of its European operations, with the opening of its new European headquarters in Dublin, Ireland, Thursday. Ireland's Minister for Innovation Policy Michael Ahern officially opened CUNA Mutual’s new office. The expansion of CUNA Mutual’s International Division comes near the end of a three-year transformation effort at the company. The company is pursuing growth opportunities within its traditional credit union market and new ventures outside the credit union space. "With the opening of this office, we’re positioning for the future,” said Sue Albrecht, CUNA Mutual senior vice president of international business. “We’re energized to grow and make a difference around the world by providing people with access to financial well-being.” The company, headquartered in Madison, Wis., also has international operations in Canada, Australia, Korea and Latin America. “We see great opportunities for growth for CUNA Mutual in the European market,” said President/CEO Jeff Post during the grand opening ceremonies. “We believe the values and characteristics that contributed to our growth in the U.S. and other countries will serve us well in this part of the world.”

Winners of National Youth Week saving challenge announced

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MADISON, Wis. (5/5/08)--Ten credit unions participating in this year's Fifth Annual National Youth Saving Challenge as part of National Youth Week last week were selected randomly to receive $100 each from the Credit Union National Association (CUNA). Winners are:
* Advance Financial FCU, Schererville, Ind.; * Fort Sill FCU in Fort Sill, Okla. * Good Shepherd CU in Lincoln Park, Mich.; * Horizon Community CU in Green Bay, Wis.; * Kansas Blue Cross Blue Shield CU in Topeka, Kan.; * M-C FCU in Danville, Pa.; * Members First CU in Columbus, Ohio; * Sandia Area FCU in Albuquerque, N.M.; * Sikorsky Financial CU in Stratford, Conn.; and * Sun FCU in Maumee, Ohio.
Through the saving challenge, credit unions sought to motivate youth and their parents to become more active users of credit union services. Participants tallied the total amount of deposits, number of new accounts opened and total number of deposits made by youth during the week. CUNA sponsored the event. Young members deposited nearly $11.8 million in their savings accounts throughout the week.

U.S. Central acts to obtain full access to Fed credit

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LENEXA, Kan. (5/5/08)--U.S. Central FCU has taken all necessary action to obtain full access to Federal Reserve credit facilities, including intraday credit and the discount window, the corporate credit union announced Friday. As the nation’s only wholesale corporate credit union, U.S. Central is the central source of liquidity for the nation’s Credit Union System. Access to the Fed discount window adds the nation’s central bank--the ultimate source of backstop liquidity--to U.S. Central’s arsenal of $20 billion in market-based sources of liquidity. “With access to Federal Reserve credit, U.S. Central has further strengthened the resources available to assure that we will be in a much better position to fulfill our role as a liquidity provider to the Corporate Credit Union Network,” said Francis Lee, U.S. Central’s president/CEO. “We have always had a solid footing as a liquidity provider; now we have the Fed discount window as an added safety net as well,” Lee added. Federal Reserve policy makes the discount window available only to institutions that maintain required noninterest-bearing balances, called “reserves,” with the Fed. Because U.S. Central is a “bankers’ bank,” it previously had been exempt from the reserve requirement. However, U.S. Central opted to waive its bankers’ bank exemption from reserve requirements, and gained full access to the Fed discount window, just like most other depository institutions. The impetus for the plan was to facilitate U.S. Central’s ability to work more closely with the Fed in reducing payment system risk and improving efficiency in processing credit union payments. Recent events in the economy have underscored the benefit of having expanded sources of liquidity available to the Credit Union System. “In these turbulent market conditions, everyone in the Credit Union System should take an added measure of comfort knowing U.S. Central has all the liquidity it needs to continue to provide vital services to the Corporate Credit Union Network,” said Lee.

CUNA CSS audited financials available online

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MADISON, Wis. (5/5/08)--The 2007 audited financial results for the Credit Union National Association (CUNA) and for CUNA Strategic Services (CSS) are available online. The reports--CUNA 2007 Audited Financial Results and CSS 2007 Audited Financial Results--are posted separately as downloadable PDF files on CUNA's proprietary site for the association's members. They are also accessible to association members through CUNA's "About Us" page at www.cuna.org. For more information, use the resource links.

Officers gun discharges in CU wounds fellow officer

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CONCORD, N.H. (5/5/08)--A Concord, N.H., police officer was shot inside an under-construction branch of Granite State CU Thursday when another officer's gun discharged. The officer was treated and released from a local hospital. "We're glad nobody was seriously injured," Denise Caristi, president/CEO of Granite State CU told News Now. Four officers were inside the branch around 4:30 a.m. when the incident occurred. The officer, who was wearing a bulletproof vest, was shot in the chest. "We're not sure why the officers were in the building," Caristi added. "The state attorney general's office is investigating." There was no damage to the branch, and construction is still on schedule, she said. The credit union branch is scheduled to open this summer. Granite State CU is located in Manchester, N.H. It has $205 million in assets.

Check out Americas CU Conference speakers podcasts

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MADISON, Wis. (5/5/08)--Two new podcasts are available that feature samplings of speakers who will be presenting at the 2008 America’s Credit Union Conference & Expo in New York City June 29-July 2. The conference is presented by the Credit Union National Association. Mark Adams will present “Play to Your Strength: Real Championship Coaching.” Adams is a former basketball coach, a broadcaster for ESPN and a professional speaker. In his podcast, Adams says that “playing to your strengths” means that, to face challenges, people need to focus on what they’re good at doing. He challenged individuals to move 10% of their lives away from their weaknesses toward their strengths or talents. Credit union professionals should focus on some activity that they can do over and over again to develop their talents, and then meld those talents with the fundamentals of personal service, Adams said. To find inspiration, credit union managers must motivate themselves, and hold themselves accountable first before looking to others in the industry or community, Adams said. The second podcast features David Merman Scott, author of “The New Rules of Marketing & PR.” He will present a breakout session called “Blogs, Podcasting, Viral Marketing, Online Media: How to Reach Your Members Directly.” He also is a featured speaker in the Executive Book Series. Attendees who sign up for the series will receive his book and seven other books.

CU System briefs (05/02/2008)

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* HARAHAN, La. (5/5/08)--The Louisiana Credit Union League has awarded scholarships to four Louisiana credit union professionals to attend the Southeast CUNA Management School in Athens, Ga. They are Lloyd Cockerham, president/CEO of Breco FCU, Baton Rouge; Jean Helmer of The New Orleans Firemen's FCU; Cindy Beauregard of Heart of Louisiana FCU, Pineville; and Brian Leger with Lafayette Schools FCU, Lafayette. Cockerham will receive full tuition the first year and 50% tuition for the second and third years of the three-year school. The other scholarships will pay $1000 each toward tuition … * Fort Wayne, Ind. (5/5/08)--Indianapolis Colts Head Coach Tony Dungy delivered the keynote address at the Pro Fed CU 75th Anniversary Gala April 12. Dungy's speech focused on the vital role credit unions play in providing financial literacy and affordable financial services. He attributed the long-term success of Pro Fed CU to its commitment to families, community service and volunteerism. Both his parents were members of a credit union, he said. Nearly 1,500 people attended. President/CEO Barbara Berghoff highlighted the credit union's volunteers serving on its boards and committees, and Mayor Tom Henry delivered a proclamation naming April 12 Pro Fed CU Day in Fort Wayne. (Photo provided by Pro Fed CU) … * SUITLAND, Md. (5/5/08)--Andrews FCU tripled the amount it raised for the Annual March for Babies event to $15,000 this year. For the past five years, Andrews Federal has raised more than $5,000 in member and staff contributions for the March of Dimes. Andrews Federal served as a sponsor for the march, which took place April 27. From left are employee volunteers Karen Mangum, Maria Taura, Jennifer Taura and Kendall Mangum. (Photo provided by Andrews FCU) … * RIVERSIDE, Calif. (5/5/08)--Altura CU, which recently upgraded coin counting machines in two of its branches, has offered its previously owned machines to small credit unions through the Shapiro Group program of the California Credit Union League. The two credit unions receiving the machines were El Futuro CU, Porterville, which has operated since 1966 and is the oldest Latino credit union in the country, and Ketema FCU, El Cajon, which has operated since 1956 and has 569 members. The Shapiro Group pools the resources of the credit union community to help smaller credit unions. Shown with one of the donated machines is Lorna Stafford-Bentley, CEO of Ketema FCU. (Photo provided by Altura CU) ...

CUSN shared branches surpass bank branches in Denver

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LAKEWOOD, Colo. (5/5/08)--Credit Union Service Network (CUSN) announced that participating CUSN shared branching credit unions in the Denver area have surpassed several Denver area banks in number of locations. CUSN has 31 Denver area credit unions participating in shared branching, for a total of 125 locations throughout the Denver metro area. Research conducted by the Federal Deposit Insurance Corp. and DBJ Research--commissioned by the Denver Business Journal--compared the top 50 Denver area banks, by branch locations and deposits in and outside their market share. The top three banks were FirstBank, U.S. Bank, and Wells Fargo, according to the study. The three banks have 88, 86, and 79 locations, respectively. Denver area credit unions participating in shared branching have more locations than the top three banks, the study indicated. The popularity of shared branching continues to rise with the nationwide adoption of the service distribution channel, and the cooperation between credit unions is really paying off, CUSN said. Because it provides more members with convenient account access points and further levels the playing field between banks and credit unions, shared branching now ranks third in the nation in terms of branches. It is expected to soon surpass its closest competitor, Wells Fargo, CUSN said. "The numbers don't lie,” said Doug Burke, CUSN president/CEO. “Credit unions are clearly turning to CUSN as their partner for shared branching.” Shared branching offers more than 3,200 locations nationwide, serving roughly 37 million members throughout all networks.

CUs have power outages after storms hit Kansas City

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KANSAS CITY (5/5/08)--Some Missouri credit unions experienced power outages late Thursday and early Friday after storms bringing a tornado and straight-line winds swept through Kansas City, said the Missouri Credit Union Association (MCUA). There were no reports of credit unions suffering serious damage as of Friday afternoon, said MCUA (CourierNet May 2). Missouri Family FCU, Independence, was without power for most of Friday morning but power was restored at 12:30 p.m., President Stan Boursheski reported to MCUA. About half of the building remained without power Friday late afternoon. MCUA said it had not been able to make contact with several other credit unions in areas that suffered significant damages. Homes and businesses were damaged, predominantly in the northeast Kansas City area.

Remote deposit makes its way to CUs

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BURLINGTON, Mass. (5/5/08)--With the high price of gasoline putting a financial crimp in car travel, credit union members are starting to see the benefits of remote deposit, which allows them to scan a check at home, deposit it online and then destroy the check a few days later. EasCorp, based in Burlington, Mass., is a corporate credit union that offers remote deposit service called Deposzip. So far, seven credit unions in Massachusetts, New Hampshire, Indiana and Oklahoma use the service. Nine more credit unions nationwide are in the process of adding the service, George Dow, Eascorp assistant vice president of product development and member relations, told News Now. Why does EasCorp offer Deposzip? “We think it can satisfy a huge need for credit unions,” Dow said. “They can’t always be everywhere the members are. We believe Depsoszip will help credit unions overcome this problem. Combining this product with other online services, there’s nothing a credit union cannot do for its members online. “Now with an electronic deposit mechanism, the member doesn’t need to depend on mail, a credit union branch location or an ATM for deposits,” he continued. Deposzip interfaces with a credit union member’s home banking system, Dow explained. The member goes to a link, logs in and follows the steps of the process through a menu. The Deposzip software works with standard desktop scanners--basically scan and deposit--so no special equipment is needed. Deposzip also works with businesses through merchant deposit capture. Businesses would buy a more robust scanner--a duplex multi-feed scanner--that gives them the capability to scan and deposit several checks at a time, Dow said. Credit unions pay a transactional fee to buy service from EasCorp. “We developed a fee schedule that is inexpensive enough so that credit unions do not have to pass the cost on to members,” Dow said. The credit union can control access to the program through an administrative platform, Dow said. This way, credit unions can control the deposit limits of individual members. For instance, one member may have a $10,000 per day deposit limit, while another member, who may have a more questionable financial history, might only have a $1,000 per day deposit limit, Dow explained. “This is probably the least expensive deposit collection channel a credit union can come up with. It’s cheaper than getting deposits from mailing envelopes, ATMs, shared branches or walk-ins,” Dow concluded.

Study Rise in car loan delinquencies shifts collections

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NEEDHAM, Mass. (5/2/08)--Credit unions whose bread and butter loans are auto loans may face increasing delinquency rates, but maintaining the status quo in current collections practices is no longer an option for auto lenders, according to new research. Like other types of consumer lending in the nation, auto loans' delinquency rates are increasing, with the 60 days past due category rising 25% between the second and fourth quarters of 2007, said TowerGroup. Change will be mandatory to help lenders survive current market conditions that are creating a sharp increase in collections volume, said the Needham, Mass.-based financial services research and consulting firm. Lenders do not want to repossess cars, and auto owners want to keep their cars. Unlike real estate investors, auto buyers don't speculate on auto purchases hoping for appreciation in value, and they don't try to "flip" the car to make fast money, said TowerGroup. Because auto loans involve a fixed interest rate and a fixed monthly payment, a delinquent payment is a sign of trouble auto lenders can't ignore. Instead, they should dive right in to address delinquency problems on a number of fronts, the firm said. TowerGroup identified best practices in collections and delinquency management, which fall into three categories: people, process and technology. The "people" category encompasses initiatives ranging from managing the staff already in place as collectors, to capacity planning, to properly training and supporting collections staff and offering the right staff incentives at the right time. The "process" category covers areas from member/customer segmentation strategies and approaches, to rewriting loan terms if necessary, to changing front-end processes and benchmarking performance. The "technology" applications exist to help lenders combat growing delinquency rates and mitigate losses. Lenders should think beyond the existing collection practices to appropriately leverage IT resources, said TowerGroup. The report, "Stay in Your Car Ma'am: Best Practices in Automotive Finance Collections," is authored by Bobbie Britting, a senior analyst in the consumer lending practice at TowerGroup.

National CU Youth Week results announced

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MADISON, Wis. (5/2/08)--The results are in--and they’re record-breaking. National Credit Union Youth Week, hosted by the Credit Union National Association (CUNA), brought in more than $11.7 million in youth deposits April 20-26, with an average of about $150 per child. About 75,420 youth made deposits, and 6,583 new youth accounts were opened.
Click for slide show Connor (left) and Tyler Babcook show off the Got Green prizes they received for bringing plastic bags to recycle toward deposits into their Electro Savings CU youth accounts during National Credit Union Youth Week. The credit union is located in St. Louis, Mo. (Photo provided by Electro Savings CU)
Results were received from 395 credit unions. Last year, $10.1 million was deposited by youth. About 71,844 youth made deposits and 9,067 accounts were opened, at an average of $141 per child. Results were from 393 credit unions. "Not only are more young people participating in the saving challenge each year, they are also saving more," said Dan Mica, president/ CEO of CUNA. "Credit unions are spreading the word to our nation’s youth about the importance of saving, and these savvy young members are demonstrating that they have heard the message loud and clear." Youth Week’s theme was “Got Green? Grow it at Your Credit Union.” A number of credit unions used the “green” theme to promote saving and being environmentally friendly. DuTrac Community CU, Dubuque, Iowa, donated trees in honor of Earth Day and Arbor Day each time a youth deposited money into a credit union account. Both Earth Day and Arbor Day took place during Youth Week. Other credit unions reported meeting their savings goals quickly. “We surpassed our credit union deposit goal on the first day,” said Melody Aleman, marketing coordinator at SC Telco FCU, Greenville, S.C. “We had to order prizes an additional two times to keep up with the amount of kids depositing,” added Amy Blanchard, Limestone FCU, Manistique, Mich. Limestone FCU had 126 deposits, including a handful of youth certificates of deposit. “We had a great week,” Blanchard continued. “Our advantage is that we are directly across the street from the middle school and high school. We also have a branch at the school that was open on Monday and Wednesday during Youth Week.” To view a slideshow of photos from Youth Week, use the link.

Southeast Corporate weathered 2007 well report says

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TALLAHASSEE, Fla. (5/2/08)--Despite turmoil in financial markets in 2007, Southeast Corporate FCU had a solid year, according to its 2007 annual report. “Although no institution can claim to be entirely insulated from the distress in the financial markets, Southeast was well-positioned to weather the storm,” wrote Linda S. Darling, Southeast financial officer, in the Financial Officer’s Report section of the annual report. “By adhering to conservative risk-management practices in this difficult operating environment, the corporate experienced an exemplary year.” In 2007, net income rose to $6.3 million, a 70% increase compared with 2006. The increase was driven by a 21% improvement in interest income and a 10% increase in fee income, Darling noted. The combination of these two categories more than offset the 8.3% rise in non-interest expenses, she added. Also in 2007, Southeast Corporate’s Member Business Solutions credit union service organization underwrote more than $194 million in business loans for member credit unions, a 75% increase over 2006 volume. The significant rise in net income fueled an increase in Southeast’s capital, Darling wrote. Retained earnings rose to $112.3 million, an increase of 6% compared with $106 million. Total capital increased to $213.6 million, up from $207.5 million at the end of 2006, she added.

Loan criteria relaxed for Virginia tornado victims

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VIRGINIA BEACH and NEWPORT NEWS, Va. (5/2/08)--Credit unions in Virginia were finding ways to make things easier for the victims of Monday's eight tornados in the state. Virginia Beach-based Chartway FCU announced it would be more flexible for loan applicants affected by the storms. The credit union has a branch office in Suffolk, one of the hardest-hit areas. "We understand that cash flow is imperative for victims at a time like this, and sometimes federal funding just doesn't come fast enough," said Chartway President/CEO Ron Burniske. The credit union will evaluate each loan request on a case-by-case basis and will be especially flexible on the dollar amount, term, and payment due day on those loans. It also will offer the option of waiving initial loan payments without a penalty fee, so victims can get back on their feet financially while waiting for federal funding and insurance checks. The leniency applies to all types of loans, both long- and short-term, Burniske said. "These people potentially lost everything they owned in a matter of seconds. We will try to help them regardless of their need," he said. "Maybe they lost their car, so we'll work with them on an auto loan. Maybe their house got torn apart, so we'll help them with a home improvement loan. If they simply need money for food or rent, we can help them with that, too. It's about us pitching in to help, as part of this community." Langley FCU, based in Newport New, announced it is matching contributions up to $10,000 in its newly created tornado relief fund for victims of the tornado. Members and non-members can visit any branch of LFCU to make contributions by cash or check throughout May. It will donate contributions to the Suffolk Chapter of the American Red Cross. The tornadoes tore apart everything in their path for about 10 miles, leaving many homeless, said Langley. More than 200 people were injured during the storms.

CUs on the Tube Check out Tinker video contest winner

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OKLAHOMA CITY, Okla. (5/2/08)--The winner of Tinker FCU’s video contest has been announced. The Oklahoma City, Okla.-based credit union invited individuals to create videos and answer the question, “What does money mean to me?” The videos were voted on by a panel of judges and viewers. The overall winner was Chase Vincent, a pre-med Oklahoma State University student. To him, money means a medical school education in chiropractics. Vincent received a $2,000 scholarship. Bracket winners received $50 iTunes gift cards, and the fan favorite, Stephanie Bowen, received a $200 iTunes gift card. To see all of the videos, use the link.

CU System briefs (05/01/2008)

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* NEW YORK (5/2/08)--The New York Coalition of Community Development Financial Institutions Statewide Conference--the first statewide gathering of community development financial institutions (CDFIs)--will meet May 8 in Albany, N.Y., according to the National Federation of Community Development Credit Unions. The federation and Alternatives FCU, Ithaca, N.Y., have organized a Credit Union Collaboration Roundtable for May 9 to develop strategic partnerships. The coalition's goals include securing an initial appropriation of $5 million to the New York CDFI Fund; maintaining a separate appropriation of $1.5 million to EDSC's Minority and Women's Business Lending CDFI grant program; and raising the visibility of CDFIs on the state's economic development agenda … * PORTLAND, Maine (5/2/08)--Steve Ford, son of the late President Gerald Ford, will be among the speakers headlining the Maine Credit Union League's 70th Annual Convention, which begins today and continues through Saturday in Portland. Its theme is Maine's Credit Unions and the Maine Credit Union League--70 Years of Giving. Other speakers include U.S. Sen. Susan M. Collins, U.S. Rep Michael H. Michaud and Gov. John Baldacci … * LANSING, Mich. (5/2/08)--CASE CU hosted a visit by State Rep. Barb Byrum to the credit union's in-school branch at the Capital Area Career Center in Mason, Mich. April 21 in recognition of National Credit Union Youth Week. The credit union and career center offer a teller internship at the branch for students enrolled in the center's banking and finance curriculum. Pictured are from left, intern Sam Fata of Lansing Catholic High School, Byrum, and Nichole Putman, CASE CU sales and service leader. (Photo provided by CASE CU) … * COLUMBUS, Ohio (5/2/08)--Fewer than 23% of Ohioans encourage financial literacy in their families, reported the Ohio Credit Union League at a press conference in the Statehouse on credit unions' financial education initiative. League President Paul Mercer said Ohio credit unions are taking action to protect the state's future by teaching students to make smart financial decisions. The initiative involves promoting the MoneyAndStuff.info website as a financial education resource. State Senate Minority Leader Ray Miller (R-Columbus), shown here, spoke in support of the credit unions' efforts. Sharon Custer, CEO of BMI FCU, noted that through partnerships with schools, Ohio's credit unions have educated more than 20,000 students in nearly 200 schools about financial matters. (Photo provided by the Ohio Credit Union League) …

Missouri CUs help stop elder abuse with DVD

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JEFFERSON CITY, Mo. (5/2/08)--Missouri credit unions are taking a role in the fight to stop financial abuse of the elderly by participating in a video. As a funding sponsor of the new Missourians Stopping Adult Financial Exploitation (MOSAFE) consumer video, representatives of the Missouri Credit Union Association (MCUA) participated in the MOSAFE media conference to introduce the new MOSAFE consumer video on April 23 (CourierNetApril 30). “Credit unions have been involved in this project from the very start through funding and assisting MOSAFE with the video’s content,” said Peggy Nalls, MCUA senior vice president, public/legislative affairs. “This is an important tool for Missouri seniors and the people who care for them in helping to protect their assets.” The video is narrated by Doris Roberts, better know as Raymond’s mother on the television show, “Everybody Loves Raymond.” Missouri credit unions also helped MOSAFE produce a video in 2005 that trained employees of financial institutions to help them recognize and report elder abuse.

WOCCU efforts contribute to European Parliament report

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BRUSSELS, Belgium (5/2/08)--A report adopted April 22 by the European Parliament on volunteerism contains the first formal definition of credit unions to be included in a European Union (EU) document. The definition was added as a result of lobbying efforts by the World Council of Credit Unions (WOCCU). Authored by Marian Harkin, the European Parliament Rapporteur and an Irish member of the European Democrats Party, the report promotes the value of volunteerism and designates 2011 as the European Year of Volunteering. It includes a reference to the role credit unions play with regards to volunteerism. The reference reads: "…(W)hereas volunteers play an important role in achieving the Lisbon Strategy goal of socio-economic cohesion by contributing to financial inclusion, for example, by establishing credit unions which are regulated and not for profit financial cooperatives, run and governed by volunteers." The reference was supported by WOCCU in collaboration with consulting firm Policy Action Ltd. It is the first formal reference in an official EU document that defines credit union ownership and governance. It makes possible the use of the report to influence other EU decision-makers, according to Dave Grace, WOCCU's vice president of association services. "The reference to credit unions is part of a much larger, further-reaching document on the importance of volunteerism with European Union countries," Grace said. "Thanks to Marian Harkin's efforts, this is a big step forward for credit unions."

Slowdown in Latino remittances doesnt affect IRnet

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MADISON, Wis. (5/2/08)--Many Latin American immigrants in the U.S. have stopped sending money back to their families in the past two years, but it hasn’t affected the level of international remittances for the World Council of Credit Union’s (WOCCU) International Remittance Network (IRnet). The Inter-American Development Bank in Washington, D.C., released Wednesday a survey conducted in Spanish in February with 5,000 people (The New York Times May 1). About 50% of the 18.9 million Latino immigrants in the U.S. now regularly send money to relatives in foreign countries, compared with 73% two years ago, the survey indicated. The drop in remittances is a result of downward economic pressures due to the downturn in the low-wage U.S. job market amidst the general economic malaise and the Bush administration’s crackdown on illegal immigrations, the survey said. About 47% of the immigrants surveyed said they did not have legal status. However, while the number of immigrants sending remittances declined, the total dollar amount of remittances rose between 2006 and 2008, the study said. It estimates total remittances sent to Latin America of $45.9 billion in 2008, an increase of $500 million over 2006. WOCCU’s IRnet program overall has seen a flat, unchanged number of remittances over the past year, Greg Moser, vice president of WOCCU services, told News Now. The program serves nine countries--seven in Latin America. The participating countries are Kenya and Jamaica, and in Latin America: Bolivia, Ecuador, El Salvador, Guatemala, Honduras, Mexico and Nicaragua. Of the seven countries in Latin America, IRnet remittances declined in two countries and increased in five during the first quarter of 2008--for an overall effect of essentially no change, Moser said. There were 344,000 remittances through the first quarter of 2007, and 340,000 remittances through the first quarter of 2008, he added. There were 1.506 million total IRnet remittances in 2007, Moser said. “We’re monitoring the numbers on a monthly basis to check on any growing trends,” he said. “Our remittance program is unique in that our receiving point for remittances in those countries is credit unions, not a Western Union.” Tiffany Kultgen, WOCCU remittance services manager, said a key time frame is rapidly approaching--the Mother's Day week is the highest remittance time of year in Latin America. “If the remittance decrease continues during the Mother’s Day holiday in Mexico, it would be indicative of an ongoing trend, more than just a dip in remittances,” she said.

Pennsylvania Foundation directors announced

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HARRISBURG, Pa. (5/2/08)--New directors for the Pennsylvania Credit Union Foundation were approved at Wednesday’s board meeting for the Pennsylvania Credit Union Association (Life is a Highway May 1). The new foundation board members include:
* Terry Shoemaker, CEO, Berks Community FCU, Reading; * Paul Santoski, CEO, First CU of Scranton; * George Nahodil, executive vice president, marketing, Members 1st FCU, Mechanicsburg; and * Maria LaVelle, CEO, Westmoreland Community FCU, Greensburg.
Also, the board approved Jay Murray, Mid-Atlantic Corporate FCU, Middletown, to replace Ed Fox, retiring CEO of Mid Atlantic Corporate, as an ex-officio member of the foundation board.

Suit vs. CU seeks class action in Centrix repossessions

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ST. LOUIS and ARLINGTON HEIGHTS, Ill. (5/2/08)--A credit union that used subprime auto broker Centrix Financial as its agent is the target of a lawsuit seeking a class action status related to auto repossessions. The lawsuit, filed in Jackson County (Mo.) Circuit Court last week, against Arlington Heights, Ill.-based Meadows CU, names Minnie Pearl Landrum of Grandview, Mo., as the class representative, said a St. Louis-based business and legal publication (Daily Record April 28). Centrix Financial is not a party in the lawsuit because it is in a Chapter 11 bankruptcy reorganization in Colorado. The case includes Missourians who within the past six years purchased an auto with a loan from the credit union and saw the auto repossessed. Edward Buettner, CEO of the $108.6 million asset credit union, told News Now the credit union had not received anything about the lawsuit. "I have not heard about it, so I really couldn't comment about it." The suit alleges the credit union, through its agent, used faulty notices it repossessed vehicles from borrowers who fell behind in payments. Repossession notices sent by the credit union via Centrix were incomplete or misled borrowers about their rights under Missouri law, said the petition. Notices of repossession had no contact information for borrowers to inquire about the debt and did not include the amount owed. The lawsuit is asking the court to rule that the credit union cannot sue the borrowers to collect on deficient balances and is seeking monetary and punitive damages.