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CU System briefs (06/12/2014)

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  • MADISON, Wis. (6/12/14)--Effective immediately, Mike Schenk is interim chief economist of the Credit Union National Association. Bill Hampel, who normally serves as CUNA senior vice president of research and policy analysis and chief economist, is currently interim president/CEO of the trade association. As vice president of economics and statistics, Schenk conducts economic research and supports CUNA's public relations and lobbying efforts. His analyses regularly appear in trade publications, and he is a frequent contributor in the financial media. "I've worked closely with Mike for 22 years and thank him for taking on this important assignment, knowing that the economic analysis provided to credit unions and CUNA's advocacy efforts will not skip a beat," Hampel said. Prior to joining CUNA in 1992, Schenk was director of research for Financial Research Corp.  He has a bachelor's degree in economics from St. Mary's College of Minnesota, Winona and earned an MBA in finance with a concentration in banking and financial intermediation from DePaul University, Chicago. Bill Cheney, former CUNA president/CEO, stepped down June 10 to become president/CEO of SchoolsFirst FCU, Santa Ana, Calif. ...
  • NAMPA, Idaho (6/12/14)--Les Bois CU, Garden City, Idaho, donated new flags to the Hispanic Cultural Center of Idaho, which had been without flags for four months. On June 6, the $89 million-asset credit union helped raise flags representing the United States, Mexico and Idaho at the cultural center in Nampa. The center offers language training, loan consultation and basic business information to local residents. It also houses a free art gallery, computer lab, rental and office space. Michael Christensen, left, and Melvin Barrientos raise the Mexican flag (Les Bois CU photo) ...
  • PORTSMOUTH, N.H. (6/12/14)--The board of Northeast CU, Portsmouth, N.H., with $986 million in assets, has appointed interim President/CEO Tim Collin to be permanent CEO. Collia was CEO of Woodlands CU, Berlin, from September 2002 until it merged with Northeast in 2013. He has a bachelor's degree in business administration from Western Michigan University, Kalamazoo, and serves on a number of New Hampshire Credit Union League committees. Collia was named interim president following the death of President/CEO Peter Kavalauskas. Kavalauskas was killed in a snowmobiling accident in February just days after announcing he was retiring after 35 years at the credit union (Seacoast Online June 11) ...

Boston's FinTech startups have home at Digital FCU center

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BOSTON (6/12/14)--Digital FCU, Marlborough, Mass., will open the doors to its new DCU Center of Excellence in Financial Services later this month with a launch event in partnership with the local shared-work space firm Workbar.

Located in downtown Boston, the facility will offer "co-working," or collaborative work space and other resources specifically wired for finance sector startups.

"Through this collaboration, we hope to play a vital role in the changing environment of the financial services industry," said David Araujo, vice president of information systems at the $5.6 billion-asset credit union. "The partnership we've created with Workbar is setting the stage for continued innovation on our part and allowing (Digital) to foster and give back to emerging FinTech companies."

The center held a soft launch in January and has already secured a core group of startup companies that focus on credit scoring, wealth management and investing.

In addition to the collaborative workspace, the startups will receive industry-specific mentorship, be able to work with senior-level executives from the credit union, and have access to programming, resources and networking.

Beyond the center, startups in the new space also will have access to Workbar's network of co-working spaces--which sit just down the street--events, programming and its 700-member community.

"I think it's great how (Digital) is showing that credit unions can be some of the most innovative entities in the financial sector," said Ernesto Humpierres, founder of Socrex and member of Digital's new center since April. "By embracing entrepreneurs and change (Digital), through its Center of Excellence, is lowering the barriers for the appearance of new business models that can have a positive impact on society."

The launch event will take place June 25. It will be open to the public and will feature demos from member startups.

CUs make the listening easy in the summertime

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MADISON, Wis. (6/12/14)--As school lets out and the weather heats up, credit unions are helping their communities celebrate summer through sponsorships of local festivals and entertainment venues.
Robins FCU, Warner Robins, Ga., with $1.9 billion in assets, contributed $500 towards sponsorship of the Gray Station Better Hometowns Daylily Festival, held June 6 and 7. In addition to the flowers, the event included arts and crafts, a corn hole tournament, 5K and fun runs, a children's area, live music and a car show ( May 13).
Teachers FCU, Hauppauge, N.Y., with $4.9 billion in assets, is the title sponsor of the 2014 Sunset Concert Series. This year's performances, scheduled from the Fourth of July through Labor Day, include rock classics, bluegrass, classical and jazz.
ESL FCU, Rochester, N.Y, with $4.7 billion in assets, will support the Corn Hill Arts Festival July 12 and 13. The annual festival features hundreds of artists and continuous live music (WHEC Rochester News 10 March 28)
Meritrust CU, Wichita, Kan., with $969 million in assets, is among the sponsors of Country Stampede, a four-day country music festival. The event takes place June 26-29 at Tuttle Creek State Park in Manhattan. Meritrust CU is a sponsor for the volunteer team at the event, and will also offer event attendees a misting tent to help cool off from the hot summer sun. The music lineup will include performances by Easton Corbin, Luke Bryan, Chris Young, Eric Church, Randy Houser, Joe Nichols and Lee Brice.
UW CU, Madison, Wis., with $1.8 billion in assets, sponsors the Memorial Union Summer Stage, an outdoor music venue on Madison's Lake Mendota that is popular with local residents and University of Wisconsin students. The credit union also supports larger programs such as the Isthmus Jazz Festival and the Madison World Music Festival.

Rep. Peters emphasizes CU mission during Mich. league meeting

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GRAND RAPIDS, Mich. (6/12/14)--U.S. Rep. Gary Peters (D-Bloomfield Hills), a longtime supporter of credit unions, dropped in for a meet-and-greet appearance at the Michigan Credit Union League's Annual Convention and Exhibition last week (Monitor June 10).

U.S. Senate candidate Gary Peters, center, talks to John Buckley, president/CEO of Gerber FCU, Fremont, left, and Michigan Credit Union League President/CEO David Adams. (Monitor photo)
Since working as a state legislator, Peters has championed the credit union movement, citing credit unions as being instrumental in seeing businesses through the recession by continuing to provide loans to small businesses.

Running for the U.S. Senate, Peters said that if elected later this year, he will fight to ease the regulatory burden that credit unions face.

"It's important that we understand that the mission of a credit union in serving the members and the local community, it's not about having an overly regulatory environment," Peters said. "If we do that, a small credit union simply isn't going to be able to hire the number of lawyers and compliance folks.

"And if credit unions go out of business, then we get even further concentration of the banking industry, which I think is not good for our country."

New Ala. regulator looks to CUs for innovation, expansion

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BIRMINGHAM, Ala. (6/12/14)--In an interview with the League of Southeastern Credit Unions, newly appointed Alabama Credit Union Administrator Sarah Moore said she would like to see innovation and expansion of credit union services to state consumers during her tenure.
"Alabama has many consumers that do not use financial institutions but rather use more expensive alternative providers of financial services," Moore said in the interview, which appeared in SIGNAL, the league's quarterly magazine.
Moore served as executive vice president and chief financial officer of the Colonial BancGroup, based in Montgomery, Ala., which was seized by federal regulators in 2009. The Federal Deposit Insurance Corp. approved the sale of Colonial's $20 billion in deposits and about $22 billion of its assets to BB&T Corp (News Now April 22).

Colonial was a major lender to developers in Florida and Nevada and was hit hard by the collapse of the real estate market in those states. The bank ran into problems after it was revealed that it had bought $1 billion in mortgages from Taylor, Bean & Whitaker that Taylor Bean did not own.

Moore said she recognizes and embraces the differences in business models and regulations governing credit unions and banks.
"Credit unions serve vital roles in our communities by granting loans and providing financial services to members," Moore said.  "The walls separating banks and credit unions have been chipped away as personnel have moved from one to the other. The knowledge and experience gained in my previous careers as an auditor, bank executive and consultant to financial institutions and real estate professionals all contribute to my understanding of the business of credit unions."
When asked what drew her interest in becoming credit union administrator, Moore said she could use her prior experience to make a difference. She said she will strive to communicate effectively with management and boards of credit unions and provide information on risks and new regulatory proposals.

CUANY pays tribute to CU professionals, volunteers

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ALBANY, N.Y. (6/12/14)--During next week's annual meeting and convention in Sarasota, N.Y., the Credit Union Association of New York (CUANY) will honor credit union excellence embodied by professionals, young professionals and volunteers.
This year's outstanding professionals are:
  • $50 million to $250 million in assets: Michelle McCourt, president/CEO, Bridgeway FCU, Poughkeepsie, with $76 million in assets. Since becoming president/CEO in 2012, McCourt has led community development initiatives as well as expanding Bridgeway FCU's work as a community development financial institution and low-income designated credit union.
  • More than $250 million in assets: James Doig, CEO, Sidney FCU, with $385 million in assets. Doig has been with the credit union movement for more than 17 years. The credit union's mobile banking platform has an above-average adoption rate, and recently, it opened an environmentally friendly branch in Delhi.
CUANY named Kate Czarnecki, marketing and member services manager, Focal Point FCU, Syracuse, with $49 million in assets, as this year's outstanding young professional (The Point June 10). In 2013, she helped develop a program that served furloughed employees of the Canandaigua VA Medication Center. In addition to serving on CUANY's Young Professionals Commission, Czarnecki was recently appointed president of Rochester Chapter, where she serves as chair of the legislative committee.
The winners of the outstanding volunteer awards have nearly 100 years of credit union experience among them. Winners, listed by asset size, are:
  • Less than $50 million: Gary Brown began his tenure at $35 million-asset Compass FCU on the supervisory committee in 2007. During his time with the Oswego-based credit union, Brown helped oversee a conversion to a community charter and a merger with Oswego Hospital CU in 2009.
  • $50 million to $250 million: Melvin Feather, chair, Southern Chautauqua FCU, Lakewood, has held various volunteer positions on the credit union's board since the 1970s. He has helped guide the credit union from a small, teacher-based credit union to a community-based credit union with $61 million in assets.
  • More than $250 million: Paul Pavlovich, former chair, Mid-Hudson Valley FCU, Kingston, served on the board for 37 years. During his 15-year span as chairman, the community's largest local employer and the credit union's sponsor, IBM Kingston, closed. Pavlovich oversaw the conversion to a community charter for the credit union, which now has $779 million in assets. He retired from the board in 2013 but continues to be involved as director emeritus.
  • More than $250 million: Edward Gilligan has served on $1.08 billion-asset Capital Communications FCU's board for 21 years. He has been chair of the Albany credit union for the past 14 years. In the past five years, Gilligan has helped guide the acquisition of a mortgage lender and title agency, increased investments in Web and mobile banking, and the construction of a state-of-the-art financial center.

Pa. state CU code update on way to gov.'s desk

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HARRISBURG, Pa. (6/12/14)--The Pennsylvania Senate Tuesday unanimously passed House Bill 2009, an update to the state credit union code.

The bill, which was sponsored by Rep. Linda Schlegel (R-Sunbury), will now go to Gov. Tom Corbett's desk to be signed.

"I'd like to thank Senate leadership for moving the bill so quickly, as well as all the members of Senate for their unanimous approval," said Patrick Conway, Pennsylvania Credit Union Association president/CEO (Life is a Highway June 10).

The legislation clarifies the ability of a credit union's membership to amend, or appeal a board initiated bylaw amendment. Credit unions will no longer need to submit a petition obtained from the Department of Banking and Securities when a credit union amends or appeals its bylaws.

Also under the bill, inactive accounts would reflect the Pennsylvania Treasury escheat to five years from six years.

The legislation would give credit unions the ability to correspond with their memberships by fax, email or other electronic communication after obtaining member consent.

Credit unions could collect fees paid to outside collectors for other share or loan service-related amounts owed to the credit union. In addition, credit unions could recoup the actual sums they expend.

"We look forward to the governor signing the bill into law in the very near future," Conway said.

Cornerstone CUs' assets top $98 billion in Q1

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FARMERS BRANCH, Texas (6/12/14)--The Cornerstone Credit Union League announced Wednesday that its member credit unions topped $98 billion in assets in the first quarter, but an asset count is far from their only accomplishment through the first three months of the year (Leaguer June 11).

The league, which represents 628 credit unions in Texas, Oklahoma and Arkansas, also enrolled 100,000 new members--at a rate of 1,675 members per day--pushing membership up to 9,655,736.

Further, deposits swelled by $2.94 billion, which is about $47.5 million deposited every business day, loan growth climbed more than $1 billion, and credit unions originated nearly $7.8 billion loans, equal to one new loan every 10 seconds.

League CEO Dick Ensweiler says it's the commitment from credit unions to people that has led to the movement's continued growth and success in the three states represented by the league.

Additional Cornerstone Q1 numbers:
  • Managed more than $6.46 billion in retirement accounts;
  • Generated more than $621 million in net interest income;
  • Held a net worth ratio of 13.34%, which nearly doubles what the National Credit Union Administration deems well capitalized;
  • Provided employment to more than 27,000 people, spending more than $393 million in salary and benefits;
  • Spent more than $7.31 million to send employees to educational conferences;
  • Managed and serviced more than $31.94 billion in auto loans, including 685,000 new vehicles and 1.36 million used vehicles; and
  • Held regular reserves of more than $1.27 billion and undivided earnings of more than $7.63 billion.