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CU starts fund for member who lost home in flood

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CUDAHY, Wis. (6/13/08)--Cudahy-Southshore CU plans to set up a relief fund for a former board chairman whose home was one of those shown in national media falling into a drained Lake Delton, Wis., after flooding eroded the shoreline. Thomas and Tina Pekar's one-story home was one of five homes that collapsed last weekend when flooding breached a strip of land between the lake and the Wisconsin River. The lake, a major tourist attraction in the Midwest, was drained dry. "All the land around the home just washed away," said Chris Rosland, CEO of the $14 million asset credit union based in Cudahy, Wis. "He and his wife were contacted by the police or sheriff at about 2 a.m. They were told they needed to evacuate because the water was rising and would soon cut across the road, and then they wouldn't be able to get out," Rosland told News Now. "They packed some things, but later that morning the water washed the soil and sand away, and their house collapsed into the void." The house split in half with its porch/deck area falling into the lake bed. Thomas Pekar had been on the board since 1987 and served as chairman at least a dozen years. Before that, Pekar was a credit committee member. The Pekars moved to the Lake Delton area between two and three years ago, and Pekar is still a member of the credit union. They are staying at an area hotel until they make more permanent arrangements, Rosland said. "The ironic thing is they had other land with a doublewide mobile home that they sold recently. And they had sold their home in Cudahy when they built the one on the lake," he said. "It was their primary home." He noted many people have asked the credit union to set up a flood relief fund for the Pekars. "We'll do that and promote it on our website. People already are making donations," he said. "Our board will meet Monday to see what else we can do. "They have nothing. They were able to get back into their garage and remove a couple of things, but all their possessions are history," he said. It is not likely they will be able to build on the property again. "I'm assuming that even if they could build it back, it won't be in the near future. The land would have to be restored first," he told News Now. Rosland recalled an earlier flood, the Brown Deer, Wis., flood where homes were declared uninhabitable by the government. The homeowners were reimbursed by the county, state and federal governments, and that area is now a wetland. "You insure your house and your contents, but not the land. All the money they invested in the land is gone, unless they can get a settlement from the community and the state," he said. To complicate matters, the area's residents were told they were above a flood plane. Now, there is a disagreement among community, state and federal authorities about where the 100-year flood level standard floor should be.

Its Friday the 13th Wheres your CUs disaster plan

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MADISON, Wis. (6/13/08)--Friday the 13th may be designated as a day of bad luck and disaster, but it doesn't have to be that way for a well-prepared credit union. Credit unions faced with interruptions to business from man-made and natural disasters and accidents can take steps to mitigate the impact. But they also must be in compliance. The Credit Union National Association is offering two training possibilities related to disaster plans and compliance. On July 22 in Chicago, a compliance update seminar, part of the CUNA Regulatory Compliance School, will address: Disaster Plan Requirements, Compliance Challenges, Regulators, Flood Insurance and Mortgage Lending. It discusses regulatory requirements for an effective disaster recovery plan, and provides guidance on what should be in a disaster recovery plan. On Dec. 11, the webinar, Does Your Plan Meet Regulatory Requirements will be available with industry experts. It also discusses regulatory requirements and guidelines on what a plan should include. For more information, use the resource links.

Minnesota CUs get Hispanic-loan lessons in Paraguay

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ASUNCION, Paraguay (6/13/08)--Highlights of an internship two Minnesota credit union executives recently completed in Paraguay included: community commitment, a strong link to the credit union philosophy, and an unusual loan program that disburses funds and collects payments on a daily basis.
From left: Christian Torres, Mercado 4 operations manager; Heather Hernandez Viveros, Anoka Hennepin CU, Coon Rapids, Minn.; Lidio Guanes, Paraguayan store owner; and Jaroslav “Jaro” Mendoza, City-County FCU, Brooklyn Center, Minn., during an internship in Paraguay (Photo provided by World Council of Credit Unions)
Heather Hernandez Viveros, associate vice president of human resources at Anoka Hennepin CU, Coon Rapids, Minn., and Jaroslav “Jaro” Mendoza, assistant branch manager and loan officer for City-County FCU, Brooklyn Center, Minn., visited eight credit unions during their 11-day internship. The internship was made possible due to a partnership facilitated by the World Council of Credit Unions (WOCCU) between the Minnesota Credit Union Network and Central de Cooperativas del Area Nacional Ltda. (CENCOPAN), Paraguay's credit union association. “Our credit union recently implemented plans to serve the Hispanic population in this area, and there are aspects we can improve upon,” Hernandez Viveros said. “By going to Paraguay I was hoping to see how Latin American credit unions reach out to members and build trust with their members.” Mendoza said his visit was for much the same purpose. “In Minnesota, very few credit unions are set up to serve Hispanic communities,” he explained. “But that's what credit unions were set up to do--serve those who are underserved or not served at all.” Hernandez Viveros and Mendoza worked with Paraguayan credit union staff to explore philosophical and operational issues. Credit unions in the Latin American country emphasize community and member commitment, including helping to build and subsidize schools and pharmacies. Both participants spent time at Mercado 4 CU, examining its microfinance initiatives for the credit union, located in the center of a busy market. The member-merchants’ operations required daily cash infusions to operate, so the credit union designed a 60-day term loan with a daily repayment structure compatible with the merchant's cash flow patterns. The merchants borrow money in the morning to purchase goods to sell from wholesalers and then deposit their funds at the end of the work day. Credit union loan officers circulate among the market stalls, collecting daily loan payments from borrowers. The rates are favorable to borrowers, who save more than $40 in interest per loan, or more than $240 per year--the equivalent of a month's wages for the average Paraguayan worker--compared with rates offered by local loan sharks for the same type of service. Merchant and credit union member Lidio Guanes leveraged the loan program to expand what started as a small herbal remedies concession limited to a three-foot-by-six-foot table financed originally by a $100 credit union loan. Today, he occupies a storefront at a busy market intersection and has trademarked his products under the brand name Poha Ñana, or “natural remedies.” He also warehouses the products and serves as wholesaler to other vendors, through Mercado 4's loan program. The program also benefits the credit union. With the new loan product, the formerly struggling Mercado 4 grew its loan portfolio to $2.3 million by the end of 2007 from $1.1 million in 2005, participants said. Credit union assets also grew by 60% in 2006. “It's so incredible how they have been able to meet the needs of members rather than asking members to meet the needs of the credit union,” Hernandez Viveros said. “They are living the people-helping-people philosophy. I returned home feeling very good about being part of the credit union movement.”

Obama cancels CU appearance due to flooding

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ST. LOUIS (6/13/08)--Among the events canceled due to this week's floods was an appearance by Barack Obama at a credit union in Cedar Rapids, Iowa. The Democratic presidential contender had been campaigning in smaller venues, and did some job shadowing at a St. Louis hospital, reported the Associated Press (June 11). According to the article, Obama planned "a similar workplace event Wednesday at a credit union in Cedar Rapids, but flooding forced him to cancel." The credit union was not named. The Obama campaign consulted with Iowa Gov. Chet Culver's staff and decided to cancel to ensure no resources would be diverted from Iowans devastated by the floods (Gazette Online (June 10)

Floods close CUs in Iowa

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DES MOINES, Iowa (6/13/08)--An estimated 20 to 30 Iowa credit unions are being impacted by numerous Midwest storms and subsequent flooding, according to the Iowa Credit Union League. “A lot of Iowa is now flooding and getting pretty close to the huge 1993 state flood levels or worse in some areas,” Murray Williams, league vice president, told News Now. “Some of the biggest metropolitan areas in the state have been hit hard, including Cedar Rapids, Waterloo, Cedar Falls and Des Moines. Most of the 20 to 30 credit unions impacted are experiencing actual flooding. Several downtowns are under water.” However, most of the affected credit unions have multiple branches and are able to move their operations to other areas, Williams said. Those with main offices affected or single locations are moving to hot sites--alternative locations that credit unions have in their disaster contingency plans. Credit unions on shared branching networks are moving to the locations that are on the data processing or shared branching network, and are setting up skeleton crews, Williams said. “Although a good portion of Iowa is still accessible, numerous roads have been closing and opening, making transportation more challenging,” he added. To help Iowa credit unions with the flooding crisis, the league:
* Sent out communications telling credit unions what they need to be thinking about in a disaster and providing a checklist of tasks to do; * Asked credit unions to notify the league if they have flooding situations, so the league can help mobilize needed support services; * Deployed 15 to 20 league staff members to downtown Des Moines to help credit unions with moving to alternative locations and sandbagging against flood waters; * Kept in contact with credit unions to let them know about the weather situation around the state; and * Will send out communications soon to inform credit unions that the Iowa Credit Union Foundation’s Disaster Relief Fund can provide some funding toward flood relief efforts.

Volunteer pro awards presented by Nebraska league

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OMAHA (6/13/08)--The Nebraska Credit Union League revealed the winners of its Volunteer and Professional Distinguished Service Awards at a banquet during the league’s annual meeting and convention. This year’s Volunteer Distinguished Service Award was presented to Roy Gieck, director, LincOne FCU, Lincoln. His credit union praised Gieck’s dedication to the credit union during his tenure, which spans three decades. He has been a strong advocate for continuing education for all volunteers. Gieck was instrumental in establishing educational requirements for all LincOne volunteers, causing every one to complete the Volunteer Achievement Course program for their particular area of service. He was recognized previously with an Edward A. Filene certificate. The recipient of the L.A. “Tex” Gunzelman Professional Distinguished Service Award has spent 44 years in the credit union movement. Ted Bohlen, recently retired president/CEO, Western Heritage CU, Alliance, Neb., exemplifies the credit union philosophy of doing good, the league said. Bohlen was employed for 19 years at Western Heritage CU before retiring on Dec. 31. He is a past league director and president of the Oldwest Chapter of Credit Unions. Bohlen also served on numerous league committees.

Filene receives grant to pilot underbanked savings

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MADISON, Wis. (6/13/08)--The Filene Research Institute and the Doorway to Dreams Fund (D2D) have received a grant from the Center for Financial Services Innovations (CFSI) to pilot an innovation aimed at increasing the savings rate among underbanked consumers. The Prize-Linked Savings innovation is designed to transfer a portion of low-to-moderate income consumer lottery and gaming expenditures to a savings product that offers the chance to win prizes and build assets. The program encourages financial education and regular savings, said Filene. “This is a tremendous opportunity to bring a new way to save to the market,” said Mark Meyer, Filene executive director/CEO. “This grant and partnership help us bring a Filene i3 innovation to scale and demonstrate that credit unions can offer a new path to financial security for underbanked individuals.” Filene will partner with D2D to implement the Prize-Linked Savings pilot in targeted Michigan credit unions from June through December 2009. Dave Adams, Michigan Credit Union League president/CEO, voiced his support for Filene and the pilot. “We’re delighted to further incubate the Prize-Linked Savings concept and champion credit union innovation,” he said. CFSI chose four projects from 133 applications. The four grantees will receive support for projects that provide financial services and asset-development opportunities to underbanked consumers. The grant is part of CFSI’s 2008 Nonprofit Opportunities Fund.

Leadership forum kicks off Latino CU Conference

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FARMERS BRANCH, Texas (6/13/08)--The Fifth Latino Credit Union Conference kicked off this week in Dallas with a leadership forum featuring three credit union professionals. John Herrera, vice president of Latino affairs for the Center for Community Self-Help and the chairman of Latino Community CU, Durham, facilitated the panel, which was themed “Latinos and credit unions--the crossroads where mission meets opportunity.” The Latino market is a perfect demographic target to focus on because it encompasses three fields of membership credit unions are lacking: youth, immigrants and the underserved, said Dick Ensweiler, president/CEO of the Texas Credit Union League (LoneStar Leaguer June 12). Once Latinos are established with the credit union, a relationship is formed and growth will be encouraged. A credit union’s effort to support Latinos and earn a Juntos Avanzamos (Together We Advance) designation, along with cultural openess and acceptance, will make the financial world less stressful for them, Ensweiler said. It should be up to credit unions to determine their field of membership, and credit unions should generate community interest, said Bill Cheney, president/CEO of the California and Nevada Credit Union Leagues. Harriet May, president/CEO of GECU, El Paso, Texas, and treasurer of the Credit Union National Association board of directors, echoed his thoughts. “[Generating community interest and relationships with the credit union] is our culture, our business and the right thing to do,” May said. Credit unions should know their communities and engage in the activities that not only benefit the credit union, but people as well, she added. “The credit union is one big family,” concluded Herrera.

CUNA Mutual Storms close CUs in four states

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MADISON, Wis. (6/13/08)--Credit unions in four states are closed due to flooding from last weekend's storms, CUNA Mutual Group said Thursday. "We are aware of credit unions across Iowa, Minnesota, Wisconsin and Indiana that are closed due to flooding," said Phil Tschudy, media relations manager at CUNA Mutual. "Some have sustained water damage; however, none have reported any significant damages to CUNA Mutual at this time," Tschudy told News Now. Credit unions with damage claims can contact CUNA Mutual's Disaster Response Claims at 800-637-2676, which is available 24/7/365. News Now also checked with several leagues. Most reported they had not received reports of the storms' impact on credit unions in their state. See related stories for reports on credit unions in Iowa and Wisconsin. "I spoke with field staff and credit unions in the Quad Cities area (on the Illinois side) and southeast Illinois along the Indiana border," said Will Willie, public relations coordinator at the Illinois Credit Union League. He added there had been "no reports of impact on our credit unions so far." The Kansas Credit Union Association (KCUA) reported that it had not received reports of credit unions with damage. "There was a tornado in Manhattan last evening (Wednesday), but the credit union reported that it sustained no damage," said Ashley Bridgeman, communications specialist at KCUA. The credit union was open for business Thursday. The Midwest's plight likely will worsen. A line of severe thunderstorms moved across the area again Thursday, emptying more water on many areas already flooded or at the brink of flooding.

What IDAs can mean for CUs

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FARMERS BRANCH, Texas (6/13/08)--Credit unions looking to increase their field of membership, increase member loyalty, enhance their presence in the community or demonstrate their commitment to the credit union mission and cooperative principles should consider Individual Development Accounts (IDAs), according to speakers at a recent conference. IDAs were the topic of a pre-conference workshop at the Fifth Latino Credit Union Conference in Dallas this week. Terry Ratigan, senior consultant wit hteh National Federation of Community Development Credit Unions and Deirdre Silverman, director of community programs with Alternatives FCU in Ithaca, N.Y., presented the session (LoneStar Leaguer June 13). IDAs are a powerful anti-poverty tool. They teach people how to budget, save and build assets. “They are a natural fit for credit unions,” Ratigan said. The accounts are designed to help low-income families accumulate assets. They are set up like a share certificate with limited access. Participants must specify a savings goal, such as saving for a home or secondary education. If participants are successful in meeting their predetermined savings plan, their dollars are matched by how much was predetermined in their plan. IDAs aren’t for everyone--some will drop out, Silverman noted. But “IDAs are problem-solvers,” she said. “They get people into better savings habits. They increase financial stability, teach more productive use of credit and improve communities.” Credit unions can determine how they will participate. They can hold accounts and allow a community partner to manage the accounts, hold and help fund the IDA accounts, or help fund and manage the program themselves. “It’s important to look at an IDA as a tool, not a product,” Ratigan said. “Leveraged effectively, IDAs can empower individuals and change the face of the community.” The conference was organized by the National Federation of Community Development Credit Unions, the Network of Latino Credit Unions and Professionals, and the Texas Credit Union League.

Nebraska league services corp elect officers

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OMAHA, Neb. (6/13/08)--The Nebraska Credit Union League and Services Corp. boards elected officers at the league’s annual meeting June 6. The following were re-elected to the league’s executive committee:
* Brian Christensen, chairman, Columbus United FCU, Columbus; * Tom Kjar, 1st vice chairman, Creighton FCU, Omaha; and * Ken Bradshaw, 2nd vice chairman, Liberty First CU, Lincoln.
Other members of the board are:
* Helen Dafney, Western Heritage CU, Alliance; * Steve Edgerton, Centris FCU, Omaha; * Mary Johnson, Omaha Police FCU; * Kenn Miller, Aliant FCU, Lincoln; * Cheryl Montgomery, Kearney Eaton Employees FCU, Kearney; and * Bob Tingelhoff, OPPD Employees FCU, Omaha.
Officers re-elected to the Service Corp.’s executive committee include Kjar, chairman; Tingelhoff, vice chairman; and Johnson, secretary/treasurer. Other members of the Services Corp. board include:
* Edgerton; * Chris Nielsen, Nebraska State Employees CU, Lincoln; * Dee Schriner, Kearney FCU, Kearney; and * Scott Winkelman, Fremont First Central FCU, Fremont.