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Rating for Members United Corporate reflects economy

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CHICAGO (6/4/08)--In a sign of the times, Fitch Ratings has reaffirmed the ratings of Members United Corporate FCU with long-term IDR at "AA-" but reduced the outlook ratings to reflect the downturn in the economy. Fitch has taken similar measures with other corporates and other investment entities the past few months. "Rating agencies clearly are taking a cautious view of all financial institutions at this time," Members United CEO Joe Herbst told the corporate's Economic Forum yesterday. "The continuing market dislocation has resulted in distressed market pricing. This action by Fitch is largely driven by the unrealized losses we've experienced as a result of these unprecedented market conditions." Herbst added, "We remain confident in the performance of our portfolio and balance sheet. These unrealized losses are expected to be erased over time, as this situation eases and the market values of the securities return to normal levels." Fitch said assigning a Rating Watch Negative reflects its concern "of an increasing possibility that the company could realize meaningful losses in its investment book." It said that should any losses incurred remain manageable and Members United's other fundamental strengths remain intact, particularly its considerable liquidity, the company's ratings would likely stabilize. "The size of the investment book and the dislocation in the credit markets have contributed to a large unrealized loss position in relation to capital," said Fitch in a press release. "The investment portfolio is of high quality and continues to pay as agreed to at this point, but does contain meaningful exposure." Members United have not incurred any losses and its ample liquidity provides it with a strong ability to hold its investment securities, Fitch said. It also noted that the company continues to "exhibit sound credit fundamentals, robust risk management practices, and its franchise remains solid." Members United is the second-largest corporate credit union, with total assets of $13.8 billion. It serves 2,400 member credit unions--about 25% of the nation's credit unions.

IUSA TodayI features Biz Kid in Money section

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FEDERAL WAY, Wash. (6/4/08)--BizKid$, a television program underwritten by America’s Credit Unions, aimed at teaching youths about money, received coverage in Monday’s USA Today Money section. Rebecca Charbonneau, a member of Kitsap CU, Bremerton, Wash., was featured in the article. Charbonneau was in Episode 104 of BizKid$ for opening a candy store at the age of 15. “Rebecca really embodies the message of the show,” said RoxAnne Kruger, BizKid$ project manager and senior vice president of the Washington Credit Union League. “And that is, when you stay focused and have a dream, you can make anything happen.”
BizKid$ producers recently hosted a group of National Credit Union Foundation Development Educators in Seattle. From left are: RoxAnne Kruger, Washington Credit Union League, senior vice president and Biz Kid$ project manager; Sarah Hyman, Washington Credit Union Foundation development associate; Donna Zeigler, league business development officer; Nancy Pullen, league education manager; Mark Partridge, league executive assistant to the president; Stacy Ellifritt, league event and project coordinator; and John Annaloro, league president/CEO. (Photo provided by the Washington Credit Union League)
Charbonneau has spoken at meetings and conventions on behalf of BizKid$, she added. Financial education has never been more important--so the timing of BizKid$ is incredible, Kruger said. The show highlights the importance of financial literacy, and entrepreneurship--which is vital to the economic environment. “Credit unions have a long tradition of fostering financial education,” Kruger said. “BizKid$ is an innovative way of communicating financial education to the next generation.” BizKid$ is funded by the National Credit Union Foundation, and was developed by Junior Achievement. It airs on 311 of the nation’s 343 PBS stations in 49 states. American Public Television reported that by March, the show had reached 118 million households. It is airing in 14 of the nation’s top 15 markets. About 140 credit unions, leagues, foundations and affiliated system organizations and service providers have supported Seasons One and Two. NCUF is the show’s largest funder. Other supporters include CUNA Mutual Group, the World Council of Credit Unions, the Federation of Community Development Credit Unions and several corporate credit unions. On May 22, Biz Kid$ producers and actors hosted a group of National Credit Union Foundation Development Educators in Seattle for a three-day summer workshop. Part of the workshop included a tour of the BizKid$ set, and a preview screening of an episode. A DVD of curriculum and other student activities related to the first 21 episodes also was distributed during the workshop. The DVD was created by Junior Achievement.

Illinois CUs Shred Month part of iBelong campaign

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NAPERVILLE, Ill. (6/4/08)--Credit unions in Illinois declared June “Shred Month” as part of a new statewide consumer awareness campaign called “iBelong.” The Illinois Credit Union League (ICUL) entered into an agreement to participate in iBelong with the Pennsylvania Credit Union Association for two years. On shred days, the community is invited to bring unwanted personal documents, such as tax paperwork, old account statements, cancelled credits, and credit card and ATM receipts to be shredded in participating credit unions’ parking lots. “Every three seconds, someone becomes a victim of identity theft,” said Dan Plauda, ICUL president/CEO. “Education and properly disposing of personal documents are among the best ways to deter thieves.” More than nine million Americans are victims of identity theft each year, and identity theft fraud accounted for more than 33% of all complaints reported last year, according to data from the Federal Trade Commission. Identity thieves often steal information by dumpster diving, or rummaging through a victim’s trash in search of documents with personal information. Thieves also use phishing, where they pretend to be a legitimate financial institution to get consumers to reveal their personal information through e-mails or pop-up messages, the league said. The ICUL’s guidelines for keeping documents include:
* Credit card receipts and statements: Keep receipts until your monthly statement arrives, if it’s correct, shred the receipts. Exceptions: Keep a receipt if you’re disputing a bill or to cover a warranty or return period. Keep statements for seven years if they contain tax-related expenses; * Paycheck stubs: Make sure the information on your paycheck stubs matches your annual W-2 form, then shred the stubs; * Credit union records: At the end of the year, go through share draft carbons or statements and keep only those related to taxes, business expenses, and housing or mortgage payments; * Tax records: Keep a copy of all 1040 tax forms permanently; and * Miscellaneous: Keep household inventory, birth and death certificates, marriage licenses, divorce papers, military records, insurance claims, accident reports and claims, proof of ownership and major debt repayment, individual retirement account contribution records and legal correspondence.
More than 2,200 newspaper ads in 270 papers, 4,400 radio ads on 90 stations, 103 billboards in 19 counties and 5,500 cable TV spots began running in May as part of the iBelong campaign. The campaign touts lower fees, personal service, better rates and caring staff. For more information, along with shred locations and dates, use the links.

CU Association of Oregon taps new CEO

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BEAVERTON, Ore. (6/4/08)— Troy Stang, an executive with Arizona FCU in Phoenix, Ariz., will become president/CEO of the Credit Union Association of Oregon (CUAO) effective July 1. The announcement concludes the board’s six-month search process, said Shirley Cate, chair of CUAO’s board of directors. She said Stang is a “proven executive with an exceptional blend of strategic, analytical, business and leadership skills.” Former CUAO President/CEO Gene Poitras retired Nov. 30 after 32 years with the association. Stang currently oversees Arizona FCU’s marketing and brand efforts, membership and market growth, research, business development and sales, public affairs, governmental affairs and community service. He served a stint with the U.S. Treasury Department before joining the credit union. Stang was vice president of staff and public relations at the Texas Credit Union League, where he specialized in political and operational guidance within the state of Texas and at the federal level. He also managed and developed the Hispanic outreach initiatives for credit unions. In a release, Stang said his commitment is “to promote opportunities for the continued growth and development of CUAO’s affiliated credit unions through collective advocacy and public affairs efforts; and the delivery of innovative products and services. I look forward to calling Oregon home."

CUs help debt cancellation become law in Florida

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TALLAHASSEE, Fla. (6/4/08)--Florida credit unions can now sell debt cancellation products.Florida Gov. Charlie Crist signed a bill, which was supported by the Florida Credit Union League (FCUL), into law last week. The bill--House Bill 343--creates a new insurance product that enables insurers to directly insure, rather than reinsure, banks and other entities against losses resulting from the writing of debt cancellation or debt suspension agreements, according to the Florida House of Representatives staff analysis. Debt cancellation products are lending transactions between a financial institution and a borrower in which the financial institution, for a fee, agrees to cancel or suspend the debt upon the occurrence of certain events. The risk of default due to events such as death, disability, or unemployment, shifts from the debtor to the financial institution. “The league supported the bill,” Andrew Price, FCUL director, legal services, told News Now. “We were successful in getting this bill passed the previous two years only to have it vetoed--by two different governors--for other portions of the bill not related to debt cancellation that were added to the bill during session. “None of those previous add-ons were in this bill thus freeing up the governor to sign it. It was a clean bill this year so we were happy to get it signed and in law,” he added. The key issue with the bill’s passage is that now if credit unions offer a debt cancellation product, they don’t have to put capital into reserves for it to pay out, Price said. “So now it’s a viable product in Florida for credit unions.”

CU launches rewards-based wellness program

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SAN ANTONIO (6/4/08)--Security Service FCU has partnered with Spectrum Athletic Clubs to provide an activity-based, rewards program for its employees in Texas and Colorado.
David Reynolds, Security Service FCU president/CEO (right), trades a donut for an apple provided by Molly Daniels, vice president of human resources for the credit union. Security Service has partnered with Spectrum Athletic Clubs to provide an activity-based, rewards program--CU Fit--for its employees in Texas and Colorado. (Photo provided by Security Service FCU)
With the new CU Fit program, all 1,300 employees of the $4.376 billion asset, San Antonio-based credit union are eligible to receive a free health club membership that includes rewards-based activity incentives and online support. “It’s a significant investment,” said David Reynolds, president/CEO of the credit union. “These are well-spent dollars that mean our employees are healthier, happier and more fit--and that benefits them, their families, the credit union and our members.” The move by Security Service FCU is an example of two major shifts in corporate wellness programs, the credit union said. First, more businesses are taking on the responsibility for developing and implementing programs that traditionally have come through insurance companies. Second, there’s a growing movement toward values-based benefits programs in which benefits are viewed as a corporate investment, rather than an expense. “We definitely view this as an investment in our employees and their families,” Reynolds said. “We value our employees. CU Fit is a beneficial program that we hope will contribute to their success, just as they contribute to the success of the credit union.”

Law allows Connecticut CUs to open offices in emergencies

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WALLINGFORD, Conn. (6/4/08)--Connecticut Gov. Jodi Rell recently signed into law an act that would allow credit unions to open temporary offices in the state in an emergency, according to the Credit Union League of Connecticut (CULC). The act will be effective Oct. 1. An emergency is defined as: conditions that arise from enemy action or threat of enemy action, from riot or threat of riot, or from extreme weather conditions, said Kelly Ramsey Fuhlbrigge, league vice president of government relations. “This is an important act because it will allow our state commissioner to act quickly in the event of a disaster, so that credit union members can have seamless access to their credit union services in emergency situations,” said Tony Emerson, CULC president/CEO.

PCUA to CUs Make room for student loans

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HARRISBURG, Pa. (6/4/08)--As the student lending market gets tighter, credit unions have an opportunity to connect with young members and provide a service to build lasting relationships, said Pennsylvania Credit Union Association (PCUA) President/CEO Jim McCormack. Many large banks have stopped lending to students attending community colleges, for-profit universities and other less competitive institutions--which means that needy students will be challenged with finding enough money to pay for school, the PCUA said (Life is a Highway June 3). McCormack encourages credit unions to provide student lending programs. Pennsylvania credit unions have created TEAMS, a cooperative program that helps credit unions offer student loans to members through the Federal Family Education Loan Program (FFELP). A number of lenders have withdrawn from FFELP because they can’t sell loans in the secondary market, the league said, referring to a recent The Wall Street Journal article. “[Student lending] is good business and reinforces the credit union’s future,” McCormack said.

Free Membership Growth dialogue audio now live

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MADISON, Wis. (6/4/08)--If you missed last week's "Supercharging Your Membership Growth Audio Conference," you can still access the free audio conference. The May 29th audio conference filled up and the Credit Union National Association (CUNA) had to cap its registration. However, the recording has been posted on CUNA's website. Use the link to access the free audio. The audio conference, hosted by CUNA's Membership Growth Task Force, featured a dialogue on strategies to increase credit union membership growth. It focused on five key areas the task force has deemed to be critically important to increasing membership growth:
* Awareness and image; * New markets; * Best practices; * Efficiency and back office issues; and * Growth metrics.
The task force is chaired by Richard Ensweiler, president of the Texas Credit Union League. Vice chair is Rodney H. Staatz, CEO of State Employees CU, Linthicum, Md. Anyone who wants to contact the CUNA Membership Growth Task Force can e-mail the account established for this purpose at

League-backed fin lit bill clears Michigan Senate

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NORTHVILLE TOWNSHIP, Mich. (6/4/08)--A league-backed bill that promotes and permits financial literacy among the options of courses eligible to fulfill math requirements under Michigan's revised curriculum standards has cleared the state Senate. According to the Michigan Credit Union League, the Senate unanimously approved S.B. 834 on May 13. The league had provided testimony in support of the measure before the Senate Education Committee (Michigan Monitor June 2). The bill has been referred to the House Education Committee, said the league. During the vote, State Sen. Michael Switalski (D-Roseville) said the bill would help position financial literacy as a valuable and popular course for students. The current level of bankruptcies, foreclosures and savings rates testify to just how valuable a financial literacy course would be, he said.

CU System briefs (06/03/2008)

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* SEATTLE (6/4/08)--A man suspected of robbing the Qualstar CU Monday was in satisfactory condition at a Seattle hospital after being shot in the hand by police trying to end a 100 mph chase in a stolen car. The man was shot when police cornered him in the driveway of a home. Two officers fired at him after the man allegedly tried to ram the patrol car with the car. The armed robber entered the $296.9 million asset, Bellevue-based credit union just before noon. Police said the car had been stolen and used in several area bank robberies (The Seattle Times June 3) … * NORTHVILLE TOWNSHIP, Mich. (6/4/08)--Mike Winks, senior vice president of lending at Lake Michigan CU, Grand Rapids, has been appointed to a four-year term on the state's new Mortgage Industry Advisory Board. The appointment was made by the Office of Financial Institutions Regulation (OFIR) Commissioner Ken Ross and recommended by the Michigan Credit Union League. The seven-member board also includes representatives from the mortgage brokers and mortgage lenders associations. Its purpose is to communicate with the OFIR commissioner issues of concern to the residential mortgage industry. It also will review and make recommendations regarding rules, administrative procedures, and courses and examinations for licensed loan officers and loan officer candidates (Michigan Monitor June 2) … * RENO, Nev. (6/4/08)--U.S. Rep. Dean Heller, left, (R-Nev.) visits with Great Basin FCU CEO Dennis Flannigan at the $115 million asset credit union's main branch on May 27. Heller, a member of the House Financial Services Committee, learned more about the credit union difference and conducted a roundtable discussion with employees/members of the credit union. They shared insights on what it means to have a credit union as an employee, as a member and even as a former bank employee. He listened to arguments for the Credit Union Regulatory Improvements Act (CURIA) and against legislation that would regulate credit unions to compete directly with banks. (Photo provided by Great Basin FCU) … * NAPERVILLE, Ill. (6/4/08)--Rodney E. Hood, vice chairman of the National Credit Union Administration Board, will be featured speaker at the annual Small CU Asset Size Conference sponsored by the Illinois Credit Union League. The conference--for credit unions with $20 million or less in assets--is set for Aug. 5-6 at the ICU System Center in Naperville. Hood will speak on the "State of the Small Credit Union." The conference also will include presentations on: disaster recovery by Gary Peck, CEO of United CU of Chicago; collections and bankruptcy by Sheila O'Leary, manager of Collectors Resources Services for ICUL Service Corp.; and a compliance update by Carol Bertoux, league associate general counsel. The event includes a welcome reception, a networking lunch and a credit union-to-credit union open forum and idea exchange … * CUDAHY, Wis. 6/4/08)--The employees of Prime Financial CU, based in Cudahy, Wis., are receiving much-needed assistance in the form of a gas allowance, deposited directly into the employee's account each month to offset their costs of commuting. The deposits begin this week for full-time employees not employed in an executive or senior management capacity. "We've all been affected by the rising cost of gas. Employees find themselves feeling the pinch at the pump as their daily commute to work becomes more costly," said Rich Koenig, president/CEO. "As a credit union and foremost a people-helping-people organization, we've taken the initiative to provide our employees some needed relief." PFCU also will offer a coupon to employees for discounts on an oil change and 20-point vehicle inspection at Donald Driver Auto Sales and Leasing Service Department to keep their vehicles running efficiently …

Texas league report examines population change implications

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FARMERS BRANCH, Texas (6/4/08)--Population growth and its implications for Texas credit unions is the subject of the Texas Credit Union League’s (TCUL) “Sea Change” report. TCUL said it believes tremendous growth potential exists in Texas’ unbanked and underserved communities. Its recent white paper--“Sea Change”--empowers credit unions with tools needed to tap into this market, the league said (LoneStar Leaguer June 3). The report, authored by Doug Foister of Credit Union Resources Inc., indicates that while over one-third of U.S. residents belong to a credit union, only 21% of Hispanics are credit union members. “We see in Texas today a demographic transformation of nearly sea change proportions,” Foister writes. “On the one hand, the state is aging markedly and on the other, it’s racial and ethnic composition is becoming increasingly diverse, with the most rapid and sustained growth occurring in the Hispanic population.” The report examines population growth in Texas and the U.S., as well as age characteristics, race and ethnicity, and the implications for Texas credit unions. Sea Change was commissioned by TCUL’s International Relationship Committee, comprising credit union leaders statewide who serve in an advisory capacity on a volunteer basis. “As many as 12 million Americans, if not more, are unbanked, and millions more are underserved,” noted Maria Martinez, chair of the committee. “Because they have no financial institution relationships, they turn to fringe financial services providers who charge them exorbitant fees for the very basic financial services. “Credit unions, which are all about giving a hand up, not a hand out, are ideally suited to serve this market,” she added. The committee’s goal is to develop programs and tools to help pave the way to the untapped markets.