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Kansas CUs prepare for FOM law effective today

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TOPEKA, Kan. (7/1/08)--The first stage of a new Kansas field of membership law goes into effect today, and the Kansas Credit Union Association (KCUA) and Kansas credit unions are preparing themselves for the changes that will follow. “KCUA and Kansas credit unions have been working hard to ensure that all Kansas credit unions understand the many components of the new law,” Haley DaVee, KCUA political and public affairs specialist, told News Now. “We recognize the complex nature of the legislation and, as such, realize the importance of Kansas credit unions understanding what they need to do to comply with this law.” The law places geographic restrictions on the areas credit unions can serve. The law grandfathers existing credit union members and their immediate family members, all existing occupational and associational groups, current geographic fields of membership up to 1 million in population and all current branch counties. It also outlines geographic limitations of up to 500,000 in population, using multiple contiguous political jurisdictions for credit unions not headquartered in a metropolitan statistical area (News Now April 15). KCUA held 12 educational sessions statewide over the past month and half to provide credit unions with an in-depth understanding of what to expect under the new law. The first set of three education sessions provided a step-by-step examination and overview of the four components of the bill--branching, field of membership for the future, field of membership grandfathered and mergers, DaVee said. The second set of nine education sessions covered what credit unions need to do to prepare to get their fields of memberships grandfathered. The grandfathering portion of the law is scheduled to go into effect on Jan. 1, DaVee added. “The association worked very hard to get everyone educated,” Vicki Hurt, CEO, Credit Union 1, Topeka, told News Now. Credit Union 1 will be grandfathered under the law. “We are looking at the current field of membership bill and are determining the best options for us,” Hurt added. KCUA will be holding another set of education sessions in early fall to cover the applications, procedures and timelines for the new portion of the legislation as established by the Kansas Department of Credit Unions, DaVee said.

Firefighters story From darkness to light

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NEW YORK (7/1/08)--“We will never forget. We will never give up.” With those words, Richard Picciotto, retired fire chief of the New York Fire Department, summed up his harrowing survival of the terrorist attacks of Sept. 11, 2001, at America’s Credit Union Conference & Exp, which began Monday in New York City. Picciotto has strong credit union ties. He has been a member of Municipal CU for 30 years, he announced and his cousin is employed by a credit union in Miami, Fla.
Click to view larger image Richard Picciotto, retired fire chief of the New York Fire Department and survivor of the Sept. 11 terrorist attacks, stressed the importance of decision making and risk management at Monday’s General Session. “When you’re in an emergency,” he remarked, “people are looking for leadership. They’ll do what you say.” He has been a member of Municipal CU for 30 years. (Photo provided by CUNA)
Picciotto was on a rescue mission in the World Trade Center’s North Tower when it collapsed. The South Tower disintegrated in 10 seconds; the North Tower, in eight seconds. “That sounds like a short time,” he said, “but it’s an eternity. “We were tossed around like rag dolls, free-falling in the blackness,” he continued. “I knew I was going to die. My life flashed before me, and I said a quick prayer: ‘Please God, make it quick.’” Picciotto and 13 other survivors—11 firefighters, one Port Authority officer, and one civilian—landed on the third floor in a void, or air pocket, buried in talcum-powder-like dust. After hours of spotty radio communication with rescuers, he glimpsed a light gray patch amid the blackness. It was a crevice in the rubble, from which Picciotto emerged--a solitary figure atop the once-proud tower’s remains. Picciotto credits tremendous support—both emotional and financial—for helping him get through the experience. He urged conference attendees to establish priorities in their lives--family and friends. “Stop to smell the roses, and appreciate what you have.” Other observations:
* Following Sept. 11, “the feeling of unity was great.” That’s disappeared, he claims, and he blames politicians for that. “Politicians tend to divide us, to target our minor differences” versus our commonalities. *Youth—often tagged the “me generation”--were affected deeply by Sept. 11. Many enlisted in the armed forces as a result. “Whatever your [political] beliefs, the troops are there to fight for us no matter what, and we need to support them.”
Above all, Picciotto is grateful God didn’t listen to his request for a quick ending. “Sometimes,” he observed, “unanswered prayers are the best kind.” America’s Credit Union Conference & Expo, which is presented by the Credit Union National Association, ends Wednesday. For more on the conference, use the link to to Credit Union Magazine’s ACUC Daily.

Wall St. Journal notes CUs as HELOC option

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NEW YORK (7/1/08)--Credit unions are a good option for consumers seeking home equity lines of credit (HELOCs), as falling home prices and the credit crunch causing lenders to freeze HELOCs on hundreds of thousands of homeowners nationwide, according to a Friday article in The Wall Street Journal. The article, “Renovators in Limbo,” by June Fletcher, lists tips for consumers who have had their HELOCS cancelled or for those worried that cancellations are pending. The home renovation boom of recent years has largely been funded by borrowing against home equity, the article said. One tip is to look locally for funding to financial institutions, such as credit unions, which still may offer financing. Banks that rely on Wall Street backing are the most likely to pull the plug on home equity liens of credit. Some big lenders such as Bank of America, Citibank, Countrywide Financial, Washington Mutual Bank and USAA to-date this year have told hundreds of thousands of consumers that their HELOCs have been frozen, the article said. New credit lines also are being limited, the article added.

CUNA introduces Web-based vendor management solution

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MADISON, Wis. (7/1/08)--Credit unions will soon have the ability to ensure that their third-party vendors comply with regulatory responsibilities and best practices when dealing with sensitive information. The Web-based vendor risk management solution will be available through CUNA Strategic Services (CSS) and TraceSecurity. This first-ever planned solution for credit unions will centralize vendor data, manage relationships, assess vendor risk, and ensure compliance with policies and controls. Credit unions rely on an increasing number of third-party vendors to deliver services to their members, and credit unions have to spend a large amount of time ensuring that they are complying with related regulations. By combining forces and leveraging the CSS thorough due diligence process with TraceSecurity’s software expertise in security and compliance, the joint venture will provide nearly 8,000 credit unions with a vendor risk-management solution. “Credit unions spend tremendous time and budget focusing on identifying and mitigating the risks associated with providing external access to sensitive data,” said Wes Millar, senior vice president, CSS. “The market of more than 8,000 credit unions has been asking for a product that can help centrally manage the risk and compliance issues they deal with, and we will announce a solution that we’ve been working on with TraceSecurity in the near future.” “TraceSecurity, as a strategic alliance provider, has been working successfully with CSS for the past several years,” said Jim Stickley, chief technology officer at TraceSecurity. “We believe this new solution will help finally bring 100% centralized control over the compliance complexities and risk management that credit unions grapple with on a daily basis.”

National CU Foundation premieres first ad campaign

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NEW YORK (7/1/08)--The National Credit Union Foundation (NCUF) is premiering its first-ever advertising campaign today. Attendees at America's Credit Union Conference (ACUC) will see the first ad today in the ACUC Daily News. New ads will appear each month in leading credit union trade publications such as Credit Union Magazine and News Now. Each ad will include photos and quotes featuring credit union leaders who invest in the Community Investment Fund (CIF). The CIF is a family of investments offered by all corporate credit unions to allow investors to donate up to 1% of their dividend to NCUF and up to 1% to their state credit union foundation or league. “We designed this campaign to build awareness of how the CIF supports programs and grants that make a real impact on people’s lives,” explained NCUF Deputy Director Steve Bosack. “To commemorate the CIF’s 10th anniversary year, ads will thank leading supporters whose investments benefit the entire credit union community as well as their own communities.” The first ad features Greater El Paso’s CU (GECU) CEO Harriet May, a board member of the Credit Union National Association and winner of NCUF’s 2008 Herb Wegner Memorial Award for Individual Achievement. The ad shows a wheelchair-bound woman who bought her first home through GECU with help from an NCUF grant program funded in part by the CIF. As May says in the ad: “National Credit Union Foundation initiatives through the Community Investment Fund, including homeownership grants for members of Greater El Paso’s CU, help make the American Dream a reality. That’s why we support NCUF.” NCUF is seeking other credit union leaders to feature in the ad series. Contact Bosack at sbosack@ncuf.coop or 800-356-9655, ext. 6752.

ACUCandE HGTV founder tells how to transform CU

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NEW YORK (7/1/08)--When Susan Packard co-founded HGTV in 1994, established cable TV networks barely took notice.
Susan Packard, co-founder of HGTV, told how an "upstart" evolved into a $7 billion cable enterprise industry during Monday's General Session at America's Credit Union Conference and Expo in New York City. (Photo provided by CUNA)
“We were an upstart, and established networks didn’t take us seriously,” Packard said during Monday’s Opening General Session at America’s Credit Union Conference & Expo in New York City. Big mistake. Since that time, HGTV has become a $7 billion enterprise with magazines, websites, a shopping network,and more in more than 170 countries. ”Always take your competition seriously,” Packard advised. “Once we had 30 million subscribers, [other cable networks] couldn’t knock us off the mountaintop.” She offered these steps credit union leaders can take to transform their credit unions:
* Build a good idea into a big idea. Talk to members constantly to make sure you’re on target, you offer the right products and services, and you’re relevant. “To be successful, you have to matter to members.” * Keep your ideas fresh and focused. Use variety and humor to attract different market segments. But beware: “Using humor is tricky,” Packard said, “and it can fall flat.” So proceed with caution.

To keep your ideas focused, use a "brand lens process." This involves defining the experience you want members to have, and choosing words and brand images that define the desired experience and identify the credit union. Repeat this process periodically to make sure you matter to members.

During the early days of the Food Network, for example, "the most exciting show on it was Mrs. Fields making cookies," she said. That changed quickly. * Recognize the importance of culture. Organizational culture “is a roadmap for employees to do good work,” she said. “There’s no right or wrong culture, but you must stand for something.”
HGTV’s core values include diversity, clarity in communications, integrity, and work/life balance. Every new HGTV employee receives a laminated card bearing the organization’s values. “Create a culture where employees can be successful and fulfilled.” America’s Credit Union Conference & Expo, which is presented by the Credit Union National Association, ends Wednesday. For more on the conference, use the link to to Credit Union Magazine’s ACUC Daily.

Mortgages lead loan growth for CUs in May

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MADISON, Wis. (7/1/08)--Credit union loans outstanding increased 1% in May, and 2.8% so far this year, with fixed-rate first mortgages leading loan growth, rising 2.6%, according to the Credit Union National Association (CUNA) monthly sample of credit unions.
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The 2.8% rise in loans outstanding year-to-date 2008, compares with a 1.6% rise for the comparable five-month period last year. “Credit union real estate lending is the main factor driving the surge in loan balances,” Steve Rick, CUNA senior economist, told News Now. “The exodus of lenders and the tightening of lending standards by other real estate lenders is providing credit unions an excellent opportunity to increase market share.” Credit union fixed-rate first mortgage loan balances rose 10.4% in the first five months of 2008, compared with 6% for the 2007 similar period, he added. “With the mortgage securitization market still froze up, portfolio lenders such as credit unions are increasing their market share in the real estate space,” Rick said. “We can expect this scenario to continue to play out as long as home prices continue to fall across the U.S.” Following the rise in fixed-rate mortgages were home equity (1.8%), credit card (1.2%), and used auto loans (1%). Unsecured personal loans, adjustable rate mortgages, and new auto loans declined 0.7%, 0.5% and 0.3%, respectively. May is the fifth consecutive month in which used-auto loans as a percentage of total loans increased. During the same period, new-auto loans as a percentage of loans have decreased.
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Credit union savings balances increased 1.9% in May, and 6.7% year-to-date. With payday falling on the last Friday of the month, share drafts led savings growth, increasing 7.9% in May. “For the year, we expect credit union savings balances to grow over 10% because of the tax rebates, slowing economy, falling home prices, and further deleveraging of household balance sheets,” Rick said. Money market accounts (2.9%), regular shares (2.5%), and individual retirement accounts increased, while one-year certificates declined 0.47%. With savings growth outpacing loan growth, the loan-to-savings ratio decreased to 80.4% in May from 81.1% in April. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--increased to 19.5% in May from 18.9% in April. Regarding asset quality, credit union 60-plus-day delinquencies remained at 1% in May, a 0.3% increase from May 2007. The movement’s overall capital-to-asset ratio remains at 11.1%. The total dollar amount of capital is $90 billion. The fast deposit growth increased credit union balance sheets and lowered the credit union average capital-to-asset ratio to 10.9% from its recent high of 11.5% last October. “This drop is to be expected during an economic slowdown,” Rick explained. “Capital is meant to be an economic stabilizer, rising during an economic boom and reduced during an economic slowdown, protecting credit union members from the vicissitudes of the economy.”

Pa. CUs helping college students through credit crunch

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HARRISBURG, Pa. (7/1/08)--Pennsylvania credit unions were noted in a recent issue of the Central Penn Business Journal for helping college students with loans despite the credit crunch. Credit unions see an opportunity in student lending because of tightening credit, Mike Wishnow, senior vice president of communications and marketing at the Pennsylvania Credit Union Association, told the Journal. The Pennsylvania Higher Education Assistant Agency (PHEAA) suspended its loan programs in February, encouraging several credit unions in the state to pitch in and help students, the newspaper said. Consumer lending is a credit union’s meat and potatoes, Wishnow said. Students can still apply through PHEAA for loans, but they are referred to a credit union or financial institution of their choice. PHEAA handles the loan paperwork, but does not actually provide the money, Jesus Cruz, Belco vice president of lending, told the newspaper. Belco has seen an increase in student lending over the past few years, and the credit union wants to get the word out to college admissions counselors that the credit union can help students with loans, he said. Pennsylvania State Employees CU (PSECU), Harrisburg, targets the student market because it hopes those individuals will use PSECU for more than just college loans--later, they may need help with buying cars or paying for their children’s needs, said Gregory A. Smith, PSECU president. In the last six years, PSECU has gained 55,000 student members, he added. Members 1st CU, Mechanicsburg, is offering a new student lending program, called Credit Union Student Choice. Members 1st partnered with eight other credit unions to offer students private lending. Students can borrow up to $75,000, with a 6% interest rate, Fred Ryerse, senior vice president of lending at Members 1st, told the Journal. The program also allows students to pay back their loans at a lower amount during the first two years, because most graduates do not make much money right away, Ryerse added. Like PSECU, Members 1st sees student borrowers as future members, Ryerse told the Journal.

Data breach affects 612 Envision CU members

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TALLAHASSEE, Fla. (7/1/08)--A data breach has affected more than one million cardholders and 612 Envision CU members--including Envision’s president. Hackers accessed information on cardholders that goes back six or seven years, Al Hammock, senior vice president of marketing, Envision CU, told News Now. The Tallahassee-based credit union received about 1,600 to 1,700 records from the FBI and the U.S. Secret Service on members whose accounts were exposed to potential fraud. After sorting through the records for cards that had expired, Envision found 612 members whose cards may have been affected. Of the 612, two members had attempted fraud on their accounts. A few weeks ago, Envision CU President Ray Cromer’s account was flagged by the credit union’s Falcon program, which monitors suspicious transactions. Another account belonging to an Envision employee also was flagged by the system. Envision has contacted all members potentially affected by the breach through a letter and ordered new cards for them, Hammock said. The replacements will cost Envision more than $2,000 (Tallahassee.com June 30). Envision has been receiving calls about the breach since Friday. “People just want to make sure they’re not affected,” Hammock said. Coverage of the data breach and its effect on Envision members was triggered when an Envision member took the letter the credit union sent about the breach to a local newspaper. The newspaper called Hammock and interviewed him for more information, Hammock said. Hammock commended the newspaper for working to “get all of the final information,” but noted that some readers wrote comments on the newspaper’s website about the breach “that were not informed on the procedures and what we’re trying to do to help members,” he said.

CU System briefs (06/30/2008)

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* TUCSON, Ariz. (7/1/08)--The Arizona Credit Union League (ACUL) honored Steve Dunham, CEO, Canyon State CU, Phoenix, as this year’s Very Outstanding Credit Union Person. The award recognizes an individual who goes above and beyond in service to the credit union movement, the league said. Dunham also is the new ACUL board chairman, replacing Linda Dhaemers, CEO, Desert Energy CU, Tucson. Three other board members were elected for three-year terms at the conference: Ken Bredemeyer, AEA FCU, Yuma; John Cassise, First Edition Community CU, Phoenix; and Dan Desmond, TruWest CU, Scottsdale ... * LATHAM, N.Y. (7/1/08)--The Credit Union Association of New York donated a Nintendo Wii gaming console, two controllers, a charging station and the WiiPlay Board Game Collection to the Children’s Hospital at Albany (N.Y.) Medical Center. “We couldn’t think of a better game to give the children than a Wii,” said William J. Mellin, president of the association. “Wii is an interactive and socializing experience; one we thought might be able to take a youngster’s mind off his or her health challenges.” From left are: association representatives Lori Mayer, Michele Molenaar, Danielle Mancuso, Joan Butler, Children’s Hospital child-life specialist Brenna Griswold, and representatives Vicki Hirsch, Cynthia White, Joann Miller and Jennifer Chenail. (Photo provided by the Credit Union Association of New York) ...

PCI firewall requirements now effective

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FRAMINGHAM, Mass. (7/1/08)--As of yesterday, retailers accepting payment card transactions are required to install firewalls to protect Web applications from hackers. The new Payment Card Industry Data Security Standard (PCI DSS) 6.6 aims to protect the privacy of consumer information by requiring retailers to place firewalls in front of Web applications or to conduct application code reviews (CIO.com June 30). The standard, created by credit card companies including MasterCard and Visa, was formerly a best practice. Credit unions have been affected by numerous data breaches that have compromised members’ credit or debit card accounts. The breaches have cost credit unions thousands of dollars to replace cards. News Now reported today that a breach at an unknown restaurant chain affected 612 members of Envision CU, Tallahassee, Fla.

Change is the keyword for tough times Mica tells CUs

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NEW YORK (7/1/08)—With the economy presenting tough times for financial institutions, “change is the keyword” and fighting for the status quo won’t be enough, Credit Union National Association (CUNA) President/CEO Dan Mica told the America’s Credit Union Conference & Expo, which opened Monday in New York City. Speaking before 1,600 attendees, Mica cautioned that credit unions “have been a movement for 74 years. It worked then, but if we don’t change, we lose,” Mica said.
Click to view larger image CUNA President/CEO Dan Mica told America’s Credit Union Conference & Expo attendees that although credit unions didn’t cause the economic crisis, they could become a secondary casualty. (Photo provided by CUNA)
“The subprime crisis is taking a bigger toll than we knew a month ago. In January, financial institutions foreclosed 20,000 homes a week. Last month, they foreclosed on 50,000 homes a week. We’re not sure where it’s taking us. “Doing what’s right doesn’t mean circling the wagons and refusing loans,” Mica said. “We are the certified white hats. Everyone else is stained now.” Credit unions can offer training and education, make appropriate loans and, if the loans aren’t appropriate, use compassion. “We didn’t make these (subprime) loans.” However, “credit unions will be hit as a secondary casualty, he said. “We should not cheer for banks’ demise even though they are our archrivals and give credit unions fits. If banks truly implode, it will affect everyone in this room,” he added. Mica noted changes coming in Congress and the White House. “Some of that change is coming today, when Michael Fryzel is sworn in as the new chairman of the National Credit Union Administration (NCUA)” and with NCUA Board member Rodney Hood’s term expiring soon. Credit unions can expect Democrats to gain 20-30 seats in Congress, going from a majority to a “working majority”--which means less negotiation and more power. A tight presidential race means “Your vote will make a difference.” “We can ride this change all the way,” he said. America’s Credit Union Conference & Expo, which is presented by CUNA, ends Wednesday. For more on the conference, use the link to Credit Union Magazine’s ACUC Daily.

Americas CU Conference and Expo opens today

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NEW YORK CITY (6/30/08)--America's Credit Union Conference & Expo officially kicks off this morning at the Hilton New York, with more than 1,670 credit union executives, volunteers and guests attending and "Powering Up" with more than 35 speakers. The attendance is the largest group since 1997's convention in Las Vegas, said the Credit Union National Association (CUNA), which presents the annual conference. Planners are happy with the turnout, especially in a weak economic environment. Consumers across the country have cut back long-distance travel and generally are sticking closer to home because of high gas prices, food prices, and transportation costs. Four hundred vendors are registered for the event, and the Exhibit Hall is sold out, according to Todd Spiczenski, CUNA vice president. Conference tickets to optional events also sold out, including three Broadway plays--"Lion King," "Gypsy," and "Mama Mia" and tonight's New York Yankees vs. Texas Rangers game. The makeup of the attendees is slightly different. This year, 45% are executive and credit union staff, compared with last year's 60%, but the event grew in the board member area, Spiczenski said, with 55% attending are volunteers. The average asset size of attendees' credit unions is $600 million, with a median asset size of $350 million. About 65 credit unions with less than $35 million in assets took advantage of the small-credit union discounts offered by CUNA. Some attendees arrived earlier this weekend to tour a community development credit union with the National Federation of Community Development Credit Unions, which is headquartered in New York City. Today's keynoters include retired New York City Fire Department Chief Richard Picciotto, author of Last Man Down: A Firefighter's Story about the events of 9/11; and Susan Packard, co-founder of Home and Garden Television (HGTV), who will discuss new business models and branding. Closing day speaker will be Steve Farber, speaking about "The Radical Leap: Extreme Leadership at Work and Beyond." Thought leader discussions run the gamut of topics--from how good leaders manage themselves first, to how blogs, potcasts, viral marketing and online media can help tap their members directly. The conference will conclude Wednesday. To see what you're missing, check out the resource link.

Thousands of flooded members get help from Wisconsin CUs

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PEWAUKEE, Wis. (6/30/08)--Wisconsin credit unions are offering special loan terms or reducing or waiving fees on financial services to help people recover in the wake of widespread flooding. No credit unions have reported flood damage to the Wisconsin Credit Union League. However, thousands of their members were affected by the floods, and many credit unions have prepared to help them. “Credit unions see first-hand the need for relief in the communities in which they live and serve,” says Brett Thompson, league president/CEO. “While assistance may vary among credit unions, in situations like this, they’re doing everything in their power to help their members.” One credit union has set aside $1.5 million to offer existing members below-market-rate home equity loans of up to $5,000 for as long as five years. The loans are intended to help people with clean-up services; home repairs; wall repairs; and replacement of furnaces, hot water heaters, washer and dryers, or furniture damaged in the flood. The credit union is also extending an auto loan special, with rates as low as 3.99%, to accommodate members needing to replace flood-damaged cars, and it is allowing qualifying members with consumer loans to skip one month’s payment without fees, the league said. In other areas, credit unions have suspended or waived overdraft charges and other fees for members. And because of road closures that have made some credit unions difficult to access, several credit unions are helping each other’s members by cashing their checks or providing cash withdrawals. “In times like these, locally owned credit unions are able to step up quickly with meaningful help for their members,” Thompson said. Thompson said it has been encouraging to see volunteers in communities across Wisconsin pulling together to help with sandbagging, cleanup and fund-raising in the aftermath of the devastation. Ironically, a retiree who spent 25 years as a volunteer on the Board of Directors for one Milwaukee area credit union lost everything when his home washed away in flood waters. A fund has been established at his credit union to help the family. “They are starting from scratch, having to replace almost everything for daily living,” Thompson explains. “They have no home, no land and no possessions, but they still have a mortgage, property taxes and the cost of demolishing what’s left of their home. So they’re thankful their credit union was first in line to help.”

B.C. Ontario central CUs announce merger

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VANCOUVER, B.C. (6/30/08)--Credit Union Central of British Columbia and Credit Union Central of Ontario will officially merge on Tuesday. The new association, named Central 1 CU, will have about $8 billion in combined assets and will represent more than 200 credit unions serving 2.7 million members in the two Canadian provinces. It will provide banking, treasury and trade services to the credit unions (Vancouver Sun June 27). Central 1's headquarters will be in Vancouver. It also will keep an office in Mississauga, Ont. Of the 500 people employed, two-thirds will be based in Vancouver. The merger is significant because it is considered a first step in creating a national organization that can support credit unions across Canada, Central 1 CEO Don Rolfe told the Sun. Rolfe said he hopes the credit union systems of Alberta, Saskatchewan, Manitoba and Atlantic Canada would join Central 1 in the future. Those systems are waiting to see how this first merger goes before making commitments to a future merger. Quebec's credit unions or caisses populaires have their own system under the Desjardins Group. Rolfe indicated Central 1 would be willing to work with Quebec's group on some opportunities.

Calif.Nev. leagues capture marketing awards

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RANCHO CUCAMONGA, Calif. (6/30/08)--The California and Nevada Credit Union Leagues earned honors recently in several national and international communications competitions.
Award -winning public affairs staff from the California and Nevada Credit Union Leagues include: Tina Ramos-Ingold, public affairs coordinator; Matt Buck, public affairs specialist; Patricia Mendez, administrative assistant; and Henry Kertman, vice president of public affairs. (Photos provided by the California and Nevada Credit Union Leagues)
The honors went to their flagship publication, Credit Union Digest; a marketing campaign for the 2007 Big Valley Educational Conference; a public advocacy campaign website and radio ad; and a special video of grant recipients. The July 2007 Credit Union Digest feature article, “The Next Big Thing,” received a first-place award in the American Society of Association Executives (ASAE) and the Center for Association Leadership’s Gold Circle Award. The article was written by Jenny Boyle, publications specialist and writer. The league received Awards of Distinction from The Communicators Awards, an international competition, for a feature article ("The Next Big Thing") and the 2007 Big Valley Educational Conference marketing campaign. In its first entry to the Videographers Award, an international competition, the leagues received an Award of Distinction for a video about credit union members impacted by the California wildfires and who received grants from the National Credit Union Foundation. It was produced by Graphic Designer Danielle Price.
Blockbuster Awards winners from the California and Nevada Credit Union Leagues included, from left: Jenny Boyle, publicatiokns specialist and writer; David Dudley, marketing specialist; Carol Payne, vice president of communications and marketing; Patricia Mendez, administrative assistant; Natalie J. Moreno, lead graphic designer; LaDonna Kohler, print buyer; Danielle Price, graphic designer; and John Drago, vice president of information technology.
In the four-minute video, the recipients emotionally recount devastating losses they incurred and thanked those who donated to help them. The leagues also received four first-place Pro & Blockbuster awards, sponsored by the Credit Union National Association. In the Pro Awards, the creditunionswork.org site won in the Best World Wide Website category, and Credit Union Digest took the top prize in the Most Improved Publication category. As part of the 2007 Public Advocacy Program, www.creditunionsworks.org was launched to increase the effectiveness in building awareness and support for credit unions. In the Blockbuster Award, the "Famous" radio ad from the 2007 Public Advocacy Program came in first in the Best Credit Union Radio Spot category; and the Big Valley Conference campaign was honored as Best Campaign with a budget of under $10,000. “Famous” and two other ads used for the 2007 campaign, used a tongue-in-cheek approach to attract quick attention on what credit unions can do for consumers. “Famous” used the story of “Jane” and how credit unions helped her become a successful business owner, and brought benefit to her community as well.

37 CDCUs help low-incomers keep millions in tax refunds

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NEW YORK (6/30/08)--Thirty-seven community development credit unions (CDCUs) and eight Community Development Partner credit unions helped low-income residents keep millions of dollars in their communities as a part of the Volunteer Income Tax Assistance (VITA) program. The CDCUs, which are members of the National Federation of Community Development Credit Unions, teamed up to prepare 6,681 returns and bring New Yorkers $7.8 million in refunds and between $2 million and $4 million in stimulus payments. VITA users who deposit their tax refund in a savings account are eligible to receive up to a $250 match after one year. Tongass FCU, Ketchikan, Alaska, has operated a VITA site for five years. It has helped more than 100 individuals receive $47,000 in tax credits. This year, the credit union reached Metlakatla, an island town of 1,400 residents, where Tongass is the only financial institution. State Employees’ CU, Raleigh, N.C., returned $14.2 million to 15,500 people at 216 VITA sites this year. The Pascua Yaqui Tribe, Tucson, Ariz., helped more than 550 people file taxes this year, with more than $1 million in returns. The tribe is working with the federation to organize its own CDCU. Alternatives FCU, Ithaca, N.Y., helped file more than 1,200 returns, returning an average of $1,514 to clients. ASI FCU, Harahan, La., has helped Louisianans with taxes for the past six years. “ASI continues to be a VITA sponsor because the program helps residents avoid predatory lenders and brings much-needed money into the community,” said Shannon Cian, VITA coordinator at the credit union. “It’s also important to note that in addition to VITA sites being an incredible benefit to the community, they are also a great membership growth strategy for the participating credit unions,” said federation President/CEO Cliff Rosenthal. “Many of our CDCUs experience their greatest growth during the tax preparation season because of their VITA sites.”

CU System brief (06/27/2008)

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* NEWARK, N.J. (6/30/08)--U.S. Rep. Donald Payne (D-N.J.), second from left, was honored before 60 New Jersey credit union leaders June 23 as the New Jersey Credit Union League's (NJCUL) Credit Union 2008 Legislator of the Year. Payne, a Credit Union Regulatory Improvements Act (CURIA) co-sponsor, has voted with credit unions on key issues such as the Financial Services Regulatory Relief Act; Fair and Accurate Credit Transaction (FACT) Act and Conference Report; Check Clearing for the 21st Century Act (Check 21); and the FDIC Reform Act. League President/CEO Paul Gentile noted Payne's ardent support and said Payne "truly understands our issues. He understands that while banks are looking to grow and expand, they expect credit unions to continue to operate under the 1934 model." With Payne are, from left: NJCUL Board Director Calvin Jackson, Gentile, and league Chairman Steve Schlundt. (Photo provided by the New Jersey Credit Union League) …

New Jersey league opens satellite office in Trenton

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TRENTON, N.J. (6/30/08)--The New Jersey Credit Union League (NJCUL) has a new home in Trenton.
The New Jersey Credit Union League's new satellite office, housed in this three-story Victorian building in Trenton, will assist the league with advocacy efforts. (Photo provided by the New Jersey Credit Union League)
The league opened a satellite office at 172 West State St., just blocks from the State Capitol. "It's no secret that we are very focused on increasing awareness of credit unions among lawmakers and looking for ways to improve the operating climate for New Jersey credit unions," said league President/CEO Paul Gentile. "It is important to have a presence in Trenton to continue our push on these fronts." The league will maintain an office in the three-story Victorian building built in 1897. The building, which received the 2001 Preservation Award for historic buildings in Trenton, features conference space that will be used for several purposes, including meetings with lawmakers, key credit union leaders and others. "This is not just for show. We will increase our staff time there and begin to bring in new elements to further utilize the space," said Gentile. The NJCUL Board unanimously approved the new location at a recent board meeting. "We are thrilled to see the league getting more politically active. Credit unions need to understand that there are so many things pending in Trenton that will affect all of us. It¹s vital for us to have a presence," said NJCUL Chairman Steve Schlundt. NJCUL currently is working on modernizing the state's state-charter act. The league has met with state officials about the goals of modernization, which would include expanded field-of-membership powers, among others, said the league.

New N. Y. Senate majority leader aware of CU issues

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LATHAM, N.Y. (6/30/08)--The Credit Union Association of New York says that the state's new Senate Majority Leader, Sen. Dean Skelos (R-Long Island), is aware of credit unions and their issues. Skelos was installed as the new majority leader less than 24 hours after the former Majority Leader Joseph Bruno (R-Capital) shocked colleagues by announcing he would not seek re-election. During his acceptance speech, Skelos declared that property tax relief would be among his first priorities. "We congratulate Senator Skelos on his appointment and look forward to continuing our relationship with him in his new position," said William J. Mellin, president/CEO of the credit union association. "We have a good relationship with the senator, having worked with him and his office for years. He is aware of credit unions and our issues. Our credit unions in his district are politically active and will be good partners to further strengthen that relationship." Bruno had been in the Senate for 32 years. His declaration came at a time when Democrats have advanced their position throughout the state, the league said. With all the state's lawmakers' two-year terms ending in December, Democrats have "a very good chance" of becoming the Senate's majority after elections, the league added.

Centrix judge terminates stay on insurance payments

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DENVER (6/27/08)--A U.S. Bankruptcy Court judge has denied a motion for extended relief from a stay on payments related to the Chapter 11 bankruptcy of Centrix Financial LLC, saying the issue is moot because the automated stay has expired. Centrix is a subprime auto lending service that serviced credit unions. Centrix Consolidated and Robert Sutton, former owner of Centrix Financial, filed the motion seeking relief June 20. According to the court documents, they sought authority for American International Speciality Lines Insurance Co., (AISLIC) to pay liability insurance proceeds under a policy for former officers and directors of Centrix for a policy period between Dec. 30, 2005, and Dec. 30, 2006. An automatic stay issued by the court earlier would not keep AIG from paying for defense costs incurred in other legislation related to Centrix's bankruptcy proceedings, Sutton and the others claimed in motion filed. They also argued they were entitled to relief from the automatic stay so AISLIC could pay defense costs. Judge Elizabeth E. Brown Wednesday issued an order denying the motion for relief from the stay, saying that the issue is moot. She noted that an amended plan of reorganization was confirmed May 16, and the assets of the estate were vested in the liquidating trust on June 2. The stay has terminated, she said, and is therefore moot. Centrix was placed under involuntary Chapter 11 protection on Sept. 15, 2006, by creditors IFC Credit Corp., Suntrust Leasing and Wells Fargo Equipment Finance Inc. They said Centrix owed them a combined $4.6 million in lease payments. Several days later Centrix and its affiliates filed voluntary petitions for Chapter 11 protection (News Now April 25). Credit unions and other entities have claimed millions against the company's assets. More than two-thirds of Centrix's portfolio is owned by roughly 230 credit unions throughout the nation. It underwrote more than 250,000 loans totaling $4 billion (News Now Sept. 6, 2002).

Tech Council Conference to spotlight compliance core processing

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MADISON, Wis. (6/27/08)--Credit union professionals at the CUNA Technology Conference in Williamsburg, Va., will hear speakers from seven of the credit union industry’s core data processors. The conference will take place July 30 to Aug. 2. Representatives from Open Solutions, Jack Henry and Associates, Ultradata, Fiserv, EPL, Fidelity Information Services and CU*Answers will be a part of a panel and answer questions from the audience. Topics addressed at the conference will include red flag rules that will take effect Nov. 1, payment card industry compliance, third party vendor agreements and security risk assessment per 12CFR748. For more information, use the link.

CU System briefs (06/26/2008)

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* DUBLIN, Ohio (6/27/08)--John Rowley, Ohio Credit Union League special projects manager, has announced his retirement after 36 years of service to credit unions. During his tenure he oversaw education outreach for credit union management, staff and volunteers, and is known statewide for his training and development of credit union staff. Most recently, Rowley served as the voice of small credit unions in the state. He was also instrumental in the success of the league's annual credit union convention, Zenith … * HARRISBURG, Pa. (6/27/08)--Paul Santoski, CEO of First Credit Union of Scranton (Pa.), died Wednesday morning at home after an illness, according to the Pennsylvania Credit Union Association (PCUA). Santoski was appointed to the Pennsylvania Credit Union Foundation Board in May. Funeral services will be Saturday at the Immaculate Conception Church, 801 Taylor Ave., Scranton. Viewing will be 4 p.m. to 8 p.m. tonight at the Vanston & James Funeral Home, Ash Street and North Irving Avenue. He is survived by his wife Judy and three sons (Life is a Highway June 26) …

CUs among the build brigade for Minnesota vets home

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WOODBURY, Minn. (6/27/08)--Hundreds of volunteers from local credit unions, the Credit Union National Association (CUNA), Republican National Convention staff, the National Journal Group and the St. Paul Building Trades Council gathered Thursday to construct a new home for injured Iraq war veteran Sgt. Marcus Kuboy in Woodbury, Minn.
Volunteers spread sand to build a home for injured Iraq war veteran Sgt. Marcus Kuboy during the Homes for Our Troops Build Brigade Thursday in Woodbury, Minn. From left are: Richard Gose, Credit Union National Association senior vice president of political affairs; Maria Cino, president/CEO of the 2008 Republican National Convention; and Mark Cummins, president/CEO of the Minnesota Credit Union Network. (Photo provided by the Minnesota Credit Union Network)
The project is part of the Homes for Our Troops Build Brigade. Homes for Our Troops is a nonprofit organization that builds homes for wounded soldiers. It is supported by the credit union movement. CUNA and the Minnesota Credit Union Network (MnCUN) are helping coordinate the project and raising funds for the effort. Volunteers will spend the weekend building the home. It will be specially adapted for Kuboy, 30, at no cost to his family and will be presented to him during the Republican National Convention. “People helping people is a fundamental credit union philosophy and this project is a great way for us to put our philosophy into action,” said Dan Mica, CUNA president/CEO. “Whether they are here in person volunteering their time or helping with fundraising efforts nationwide, our credit unions and their members are honored to participate in this special effort on behalf of a very deserving soldier.” “Owning your own home is the American dream and we are proud to be able to help make this dream a reality for Kuboy,” added Mark Cummins, MnCUN president/CEO. “This project allows credit unions in Minnesota and across the country to express their support of the sacrifices made by our military.” Ground was broken for the home in April. “Now we have the privilege of installing the doors, assembling the windows and building the roof with the generous help of the Kuboys’ new neighbors and friends,” said Suzanne Clark, president, National Journal Group. Kuboy was injured in March 2007 when an improvised explosive device detonated under the vehicle in which he was riding. A similar project in conjunction with the Democratic National Convention took place June 20-22 in Golden, Colo.

Arizonas CUs raise 510000 for CUs for Kids

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PHOENIX (6/27/08)--Arizona's credit unions raised $510,000 during 2007 to make life easier for hospitalized children at Phoenix Children's Hospital and Tucson Medical Center, according to the
Desiree Hoogerhuis, left, of the Arizona Credit Union League's Credit Unions for Kids steering committee, presents this year's traveling trophy to Gloria Mundy, CEO of Bashas' Associates FCU in Tempe, Ariz., for showing the highest percentage increase in money raised over last year for Arizona children's hospitals. (Photo provided by the Arizona Credit Union League)
Arizona Credit Union League. The league announced the total during a Credit Unions for Kids Recognition Lunch at its Annual Convention. Credit unions recognized in five asset categories for raising the most money and raising the most money per member were:
* Under $10 million in assets: Maricopa Santa Fe FCU, Phoenix, $1,916; * $10 million to $20 million in assets: Cochise CU, Willcox, $1,792; * $21 million to $99 million: Bashas' Associates FCU, Tempe, $8,589; * $100 million to $499 million: Arizona Central CU, Phoenix,$50,000; and * $500 million and over: Desert Schools FCU, Phoenix, $340,000.
One beneficiary of the funds raised is One Darn Cool School, a school at Phoenix Children's Hospital that helps hospitalized kids keep up with their studies while undergoing treatment. Arizona's credit unions are a major sponsor of the school, helping provide it books, classroom materials and teacher salaries. At Tucson Medical Center, credit unions' funds will support wellness programs, purchase life-saving medical equipment and provide health services for children. Arizona's credit unions have raised more than $3 million since 1996 for the Children's Miracle Network.

Lancaster CUs focus on Hispanic outreach

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HARRISBURG, Pa. (6/27/08)--Lancaster, Pa., credit unions are focusing their outreach on the Hispanic community. This week, Pennsylvania Credit Union Foundation Executive Director Joe Wambach traveled to Lancaster to monitor grants issued by the foundation and the National Credit Union Foundation to the Lancaster Consortium of Credit Unions Hispanic Outreach Project (Life is a Highway June 26). Wambach met with Denise Reinoso Wayman, regional manager, Mennonite Financial FCU, and Kent Hartzler, to look at the credit union’s efforts, the league said. Wambach and Wayman also visited Citadel FCU, Lancaster Red Rose CU, and Belco Community CU. Lancaster Red Rose CU is planning a branch at the Puerto Rican Cultural Center (Central Penn Business Journal June 26). Lancaster’s population is about 40% Hispanic, the newspaper said.

In the Media Maine CUs tell it like it is

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BANGOR, Maine (6/26/08)--Maine credit unions, a member, and the Maine Credit Union League educated readers of The Maine Edge.com about the credit union difference in an in-depth article Wednesday. The article began with Brewer (Maine) FCU member Mike Curran. Curran told the newspaper he likes his $37.5 million asset credit union for its simplicity, convenience of location, and the financial services--and for recognizing him every time he visits the branch. He preferred a small institution that can't be bought. Bangor FCU President/CEO Stephen K. Clark talked about the democratic, cooperative structure of credit unions, which represents "a much different model than the conventional stock ownership of most banks." Bucksport-based Seaboard FCU CEO Kyle Cashburn described the difference in for-profit (where the company maximizes the financial return for stockholders) and not-for-profit (it maximizes the financial return for its member owners) businesses. Richard Kaul, president/CEO of Brewer FCU, noted credit unions' rich history based on urban financial cooperatives in Germany and credit unions' service to people of modest means. He also said credit unions are expanding to serve small businesses. "The backbone of Maine's economy is moms and pops," Kaul told the newspaper. Jon Paradise, spokesman for the Maine Credit Union League, discussed the growth in popularity the credit union industry has seen in the state and why credit unions are popular. About half of the state's population belongs to a credit union, he told the newspaper. As cooperatives, credit unions are exempt from state and federal income taxes and return excess profits to their members, Paradise said, noting the constant battle with banks. Also discussed: field of membership growth and expansion through technology and shared branching; credit unions cooperation with each other in shared branch networks,, and credit unions' cooperative nature meaning combining. The article noted credit unions' collaboration, concluding that "all who were interviewed shared a common belief in community…but also a camaraderie among seeming competitors not normally found in any industry." Use the link for the full article.

CDCUs tax help returns 2 million to Ithaca community

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ITHACA, N.Y. (6/26/08)--Taxpayers in the Ithaca, N.Y., area received more than $2 million in income tax returns, thanks to 79 volunteers from Alternatives FCU's Community Tax Program. The credit union's volunteers filed more than 1,200 federal tax returns, with an average $1,514 returned to taxpayers, and more than 1,200 state tax returns, for an additional $403, on average. The program, also known as Volunteer Income Tax Assistance (VITA), helped low- and moderate-income working families for the sixth consecutive year. The tax preparation service is available from Alternatives for families whose household income is $40,000 or less annually or individuals whose annual income totals $25,000 or less. The credit union encouraged filers to direct-deposit their refunds and offered a low-cost solution to predatory refund anticipation loans. This year's Refund Express Loan saved 58 taxpayers a combined $11,500 in fees. The credit union cited two examples of how it helped taxpayers:
* Henry, a single father of two who worked four jobs last year but earned less than $7,000. He was not required to file a return because of low income in 2005 and 2006, which mean he didn't claim the earned income tax credit (EITC) he was entitled to for those years. The credit union filed returns for 2005, 2006 and 2007. He received $10,500 in refunds, or 150% of his annual income. * Hannah, a single mother of two and a self-employed housekeeper, nets about $6,000 a year. The credit union filed her returns for 2004, 2005, 2006 and 2007. After paying self-employment taxes owed, she received $8,100 in refunds--135% of her annual income.

CU System briefs (06/25/2008)

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* TULSA, Okla. (6/26/08)--The BizKid$ PBS television show is inspiring its teen fans to get off the sofa, according to mail received by the nationally syndicated teen financial education program, which is sponsored by America's Credit Unions and underwritten by the National Credit Union Foundation. The e-mail said the show's fans would "like to see more shows. You have not only kid fans in our house, but Mom loves your show, too," wrote Cynthia, Michael, Joshua and Armand from Tulsa. "You have been an inspiration to us all, and we would like to thank you. Yesterday, Michael (13) and Armand (8) mowed a lawn and made $40. Please rebroadcast all your shows so we can tape them" … * DENVER, Colo. (6/26/08)--The CU Association of Colorado (CUAC) announced it has endorsed Ted Harvey a Republican candidate for Congress in the 6th Congressional District. The seat was previously held by U.S. Rep. Tom Tancredo, who has been a strong advocate for credit unions, said CUAC. CUAC President/CEO John Dill noted that Harvey "understands the important role that credit unions play in providing high-quality financial services to one out of three Coloradoans." Timothy Dore, CUAC senior vice president of government affairs, said Harvey has been an advocate for credit unions in the Colorado State Senate … * RANCHO CUCAMONGA, Calif. (6/26/08)--Tim Allen, community education specialist at AltaOne FCU, Ridgecrest, Calif., teaches from the National Endowment Financial Education curriculum at Bishop Union High School, Bishop, Calif. The school was one of the first to take advantage of the credit union's Substitute Teacher Program, where Allen goes into local classrooms and instructs on financial literacy in lieu of normal class material. The school received the first School of the Year Award from the California and Nevada Youth Involvement Network (CNYIN) in partnership with the Richard Myles Johnson Foundation and San Mateo CU in Redwood City, Calif.(Photo provided by the California and Nevada Credit Union Leagues) … * RANCHO CUCAMONGA, Calif. (6/26/08)--The California and Nevada Youth Involvement Board (CNYIB) announced that Tim Allen, community education specialist at AltaOne FCU, Ridgecrest, Calif., has been elected to its board of directors. He joins board members Marissa Lott, CNYIB chairman and marketing specialist, Farmers Insurance Group FCU, Los Angeles; Jenny Casselman, Greater Nevada CU, Reno; Mike Jones, Educational Employees CU, Fresno; Maria Angelova, Xceed Financial CU, El Segundo; Michael Lee, The Golden 1 CU, Sacramento; Marlene Myers, Travis CU, Vacaville; Jenny Ketchepaw, Telesis Community CU, Chatsworth; and Mike Randall, Silver State Schools CU, Las Vegas … * FARMERS BRANCH, Texas (6/26/08)--Texas Banking Commissioner Randall James has announced he will retire Aug. 31 to pursue opportunities in the private sector (LoneStar Leaguer June 25). James was hired in 1991 by the Texas Department of Banking as deputy commissioner. He was commissioner for almost nine years … * GLENDALE, Calif. (6/26/08)--California CU, a $1.9 billion asset credit union based in Glendale, has been approved to participate in the Small Business Administration's (SBA) 7(a) and Express loan program (NewsRx.com June 21). SBA's program helps business owners who generally aren't able to secure loans through normal channels by guaranteeing loans made through private lenders such as California CU. Ron McDaniel, president/CEO of the credit union noted that small business helps create jobs in an economy where jobs are harder to find …

CU ONE employee still working--at 90

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FERNDALE, Mich. (6/26/08)--Harry Nowell, an employee of Credit Union ONE in Ferndale, Mich., will turn 90 on July 8.
Credit Union ONE President/CEO Gary Moody, left, congratulates employee Harry Nowell. Nowell will turn 90 on July 8 and has worked at the credit union since 1981. (Photo provided by Credit Union ONE)
Nowell is a “joy and inspiration to those around him,” Judi Desiletes, assistant to president/CEO Gary Moody, told News Now. Nowell works 20 hours per week at the credit union in the mail processing center, sorting and distributing all of Credit Union ONE’s mail. He also still drives himself to work. Nowell, who was born in Montreal, Quebec, joined the credit union in 1981--his third career in a lifetime. He worked in the purchasing and facilities departments, but has worked in the mail processing center for the past 10 years. He came to the U.S. when he was eight years old and acquired his citizenship as a young adult. He graduated from Central High School in Detroit and established residence in Ferndale, Mich., after marrying his wife, Elizabeth, in 1941. They have eight children, 11 grandchildren and six great-grandchildren. He worked for Ford Hospital from 1946 until he retired as assistant to the chief of maintenance in 1986. He then managed a manufacturing facility in Davison, Mich. He retired--again--in 1981, returned to the Detroit area, and started work at Credit Union ONE. Nowell and his wife earned Volunteers of the Year Awards several years ago. Nowell volunteered for the Red Cross Mobile Blood Bank, Ford Hospital, Providence Hospital, St. Joseph Oakland Hospital and Beaumont Royal Oak Hospital. He enjoys spending time with his family, visiting his summer home in Beulah, Mich., and cheering on his favorite sports teams--the University of Michigan and the Detroit Tigers.

AACULs Pro Blockbuster Award recipients announced

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MADISON, Wis. (6/26/08)--The annual Pro and Blockbuster Award winners--for excellence in public relations, marketing, and advertising by state credit union leagues and league service corporations (LSC)--were announced during the American Association of Credit Union Leagues’ 2008 Public Relations and Communications Conference in Washington, D.C. The Best of Show Pro Award went to the Pennsylvania Credit Union Association (PCUA) for its “Credit Union Better Choice” payday lending alternative program. The program provides credit unions, especially smaller institutions, with a communications campaign and resources to serve the unbanked and underserved populations. It helps credit unions demonstrate that they are concerned with the financial health of all Americans and differentiate themselves from for-profit financial institutions. The Best of Show Blockbuster Award was also presented to PCUA for its iBelong Campaign. First place Blockbuster Awards for best league or LSC advertising collateral materials included:
* Best Sales Promotion: Wisconsin Credit Union League--league marketing agency, The Credit Union Story; * Best Print Materials, two colors or less: Credit Union Marketing Resources (Texas), Texas Credit Union League Political Action Committee Fundraising Resources Guide; and * Best Print Materials, three or more colors: North Carolina Credit Union League, Marketing Council Conference Promotional Brochure.
Two first-place Blockbuster Awards for league/LSC advertising campaigns went to:
* Best Campaign, budget $10,000 or less: California and Nevada Credit Union Leagues, 2007 Big Valley Educational Conference Campaign; and * Best Campaign, budget more than $10,000: Credit Union Association of New Mexico, CU Succeed Teen’s Financial Network.
Under Best Credit Union Electronic Media Advertising, the California and Nevada leagues placed first in the best credit union radio spot category for its “Famous” spot. Two first-place winners for best credit union advertising collateral material were:
* Best Credit Union Sales Promotion: Credit Union Association of New York for its “Want a Quarter Percent Off of Your New Mortgage?” Campaign; and * Best Credit Union Print Materials, three or more colors: Credit Union Association of Colorado, Routt Schools FCU Membership Brochure.
Three first-place finishes for credit union advertising campaigns were awarded to:
* Best Credit Union Campaign, budget $10,000 or less: Growth by Design (Georgia), Time to Upgrade Campaign; * Best Credit Union Campaign, budget more than $10,000: PCUA, iBelong Campaign; and * Best Logo Design: North Carolina league, Advanced Fraud Solutions Corporate Logo.
First place Pro Awards went to:
* Blow Your Own Horn: Texas league, Value of Membership; * Best Community Relations Program: PCUA, Credit Union Better Choice Program; * Best Public Relations Project: Iowa Credit Union League, Advocacy Campaign; and * Best League Piece on the Uniqueness of Credit Unions: Mississippi Credit Union Association, Reflections of Katrina: “People Helping People”--Mississippi Credit Unions Express Thanks.
Pro Award first place finishers for best publications were:
* Magazine, small budget: Missouri Credit Union Association, Missouri Courier Magazine; * Magazine, large budget: Texas league, LoneStar Perspectives; and * Most Improved Publication: California and Nevada leagues, Credit Union Digest.
Other first place Pro Awards went to:
* Best League Annual Report or Yearbook, small budget: North Carolina league, Meeting the Credit Union Challenges--NCCUL 2006 Annual Report; * Best League Annual Report or Yearbook, large budget: Wisconsin league--league marketing agency, Lead the Way--WCUL 2006 Annual Report; * Best World Wide Web Site: California and Nevada leagues, CreditUnionsWork.org Web site; and * Best Online Publication: Credit Union Association of Oregon, Oregon Outlook.

Melbourne honored as FCUL professional of the year

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ORLANDO, Fla. (6/26/08)--The Florida Credit Union League (FCUL) announced that Joseph A. Melbourne, president/CEO, CFE FCU, is the 2008 Professional of the Year.
(From left) Rich Helber, chairman of the Florida Credit Union League (FCUL) board of directors, presents Joseph Melbourne with the Professional of the Year Award. Guy Hood, president/CEO of the league, helped present the award. (Photo provided by the Florida Credit Union League)
Melbourne was honored at the FCUL’s 2008 Annual Convention and Exposition. Melbourne has been with CFE for 14 years, serving as CEO for the past 10 years. His philosophy is to serve the growing, diverse membership with services and timely products. He personally takes calls daily from members and resolves any issues they bring to his attention, the league said. He also guided CFE through its highest growth period in the history of the credit union, the league said.

Teenagers learn the importance of saving by spending

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MADISON, Wis. (6/26/08)--Teenagers learned they needed to spend less than they earned at a Mad City Money simulation sponsored by Credit Union National Association’s (CUNA) center for personal finance. The event was one of the elective classes for youth at the Wisconsin 4H Leadership Conference. Students from an investing class at Madison, Wis.’s Edgewood High School joined the group.
Edgewood High School student Dylan Williams pays for a TV and computer at the “mall” during a Mad City Money simulation offered by Credit Union National Association’s center for personal finance.
Students Maame Brewoo, left, and April Morris learn about the importance of entering check and debit card transactions to balance their checking accounts. (Photos provided by CUNA).
More than 50 teenagers received an identity that included an occupation, a family, and a set monthly income. Debt--both credit card and school loan--were included in their mythical future. With calculators in hand, the students visited eight Mad City merchants to purchase housing, transportation, household goods, child care, clothing, entertainment and more. A credit union provided financial counseling. Chance played a role in the form of the Fickle Finger of Fate, which delivered unexpected expenses such as a flat tire or broken eye glasses and windfalls such as winning a local karaoke contest or hosting a successful garage sale. “The power of a simulation is much greater than a school lecture or advice from Mom and Dad,” said Lin Standke, manager of youth programs for CUNA. “We take money seriously, but that doesn’t mean that learning about it can’t be fun. This was an opportunity for the teenagers to experience for themselves the effects of making bad money decisions. “You can see those mental light bulbs click on when students discover that the buying an expensive house and a luxury truck means they can’t afford food or diapers for their kids. This is a realistic, non-boring way for them to learn how to make choices about money.” One student summed up the activity: “Now I will spend my money wisely and think carefully about what I need and then go with some wants. And when I need help, I will come to the credit union.” Another student put it in succinct teen speak: “I’m gonna save my butt off!”

Discovery attendees contribute 13538 to NCUF disaster aid

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MADISON, Wis. (6/26/08)--Credit union attendees of CUNA Mutual Group’s Discovery Conference contributed $13,538 to the National Credit Union Foundation’s (NCUF) Disaster Relief Fund, which provides disaster relief to credit unions and their employees, volunteers and members.
Contributions to the National Credit Union Foundation's Disaster Relief Fund help out in crises such as the recent floods in the Midwest. Here, Iowa Community CU, located in hard-hit Cedar Rapids, Iowa, is in the midst of cleaning up after the flooding receded. (Photo provided by CUNA)
The money was generated through a silent auction on donated items including guitars signed by a band--the Bodeans--electronics, vacations and Brett Favre memorabilia. So far, the NCUF has received $225,000 in donations to help Iowa credit unions, employees and members affected by flooding. “These disaster relief donations come at a most critical time,” said NCUF Executive Director Steve Delfin. “Given all the recent disasters, the NCUF, state foundations and leagues have received far more grant applications than we can fund. We are very grateful to CUNA Mutual Group for dedicating the Discovery Conference’s silent auction to helping rebuild the NCUF Disaster Relief Fund.” The relief grants are used to help credit union employees through critical emergencies, provide for longer-term recovery, help restore credit unions’ operations and assist members. NCUF also activates CUAid.coop to help credit union supporters raise disaster relief donations for the credit union community. NCUF dedicates 100% of the donations to grants. For more information, use the links.

Many ATMs destroyed in Iowas flood

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CHICAGO (6/25/08)--The water in several flooded Iowa cities took its toll on ATMs serving credit unions and banks in the area, according to several ATM manufacturers. Although the totals will be sketchy until waters recede and branch managers can get to their buildings to assess the damages, officials from Diebold Inc. told ATM & Debit News (June 19) that a large number of ATMs were destroyed. All ATMs that came in contact with the water are "totaled." Once the personal computer that drives the ATM gets wet, the ATM must be replaced, Diebold spokesperson Mike Jacobsen told the publication. Staff making repairs had to use boats to get to branches and ATMs. Johnston, Iowa-based Shazam Inc., an electronic funds network that serves ATMs in Iowa, estimated that 60 ATMs there have stopped operating because of the flooding in Cedar Rapids and Iowa City. A Wells Fargo & Co. Inc. bank shut down six of its ATMs in Cedar Rapids, Coralville, Des Moines and Waterloo. It also closed an off-site ATM in flooded Jefferson, Wis. Power outages also make it difficult to assess the extent of the damage. ATMs are considered a key part of recovery efforts during a disaster because victims find it reassuring if they can withdraw funds from their accounts to handle emergency expenses related to the disaster, the article said.

Iowa Corporate donates 100000 for flood relief

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DES MOINES, Iowa (6/25/08)--Iowa Corporate Central CU donated $100,000 to the Iowa Credit Union Foundation’s Disaster Relief Fund after issuing a $50,000 matching grant challenge to the credit union community. The money will help thousands of Iowa credit union members affected by recent flooding. The foundation already has received more than $220,000 in contributions to aid credit union members and employees. “Thousands of Iowans are in need of support as they begin to recover from the devastating floods,” said Tom Kuehl, Iowa Corporate CEO. “Our contribution will help families get back on their feet, and we are happy to be able to give back to the credit union community.” Collins Community CU, Cedar Rapids, donated $50,000 to the fund. The Iowa Credit Union League donated $25,000 to the fund and Linn Area CU, Cedar Rapids, donated $25,000 to help its members. Fourteen other credit unions in the state have contributed to the fund, along with Car Solutions/CFS Financial Services, Atlanta; the Louisiana Credit Union League; Members United Corporate FCU; and the Ohio Credit Union Foundation. The foundation also received private contributions from individuals in the credit union industry. “There has been an incredible outpouring of financial support from the entire credit union industry,” said Marybeth Foster, foundation executive director. “We will work to get these funds distributed in a timely manner to credit union members in need throughout the state.”

Online personal finance sites open door for ID theft

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NEEDHAM, Mass. (6/25/08)--New non-bank online personal finance sites that combine traditional account aggregation services with Web 2.0 concepts such as social interaction are missing a critical component: adequate fraud prevention capabilities. New research from Needham, Mass.-based TowerGroup says such sites' failure to have adequate fraud prevention capabilities leaves an open door for identity thieves. Many new online personal finance websites, such as Banzai, Mint and Wesabe, leverage intuitive user interfaces to offer personal financial management tools, financial advice and social interaction. This contrasts to the online account aggregation services offered by traditional financial institutions, said TowerGroup. The new sites leverage consumers' propensity for online interaction and information sharing to provide services and insights not usually found on most online banking portals--such as viewing personal financial information, seeing how others manage and spend their money, and receiving free financial advice. "By incorporating state-of-the-art Web technologies and community-sharing features like Web forums and blogs, these sites seek to tap into individuals' desire to interact, share, learn and belong to a like-minded community," said George Tubin, senior research director of the delivery channels and financial information security practices at TowerGroup. However, most of these new sites pose a security risk because they use single-factor authentication--just a username and password, he cautioned. That means these sites likely will become the next target of phishers and other fraudsters--especially since most credit unions and banks have moved to multifactor authentication and they aggressively educate members and other consumers about security. The newer sites must understand the sensitive nature of their customer data, and bolster their data and Web security capabilities with stronger online authentication technologies, said TowerGroup. TowerGroup also suggested that the Federal Trade Commission (FTC) consider adopting regulations and guidance imposed by the federal banking regulators for such online sites. Consumer banks will "watch this market space closely, and will either adopt similar capabilities or partner with new independent players or acquire them," said Tubin, noting the combination of new online personal finance sites and traditional institutions' product, service and security capabilities "could lead to a compelling new combination currently unmatched in the industry." For more information about the research, "The Impact of Online Personal Finance Offering: The Good, the Bad, and the Ugly," use the resource link.

CMG Mortgage Insurance offers guidance for floods

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SAN FRANCISCO, Calif. (6/25/08)--CMG Mortgage Insurance Company (CMG MI) Tuesday announced that its insured policyholders can take advantage of payment relief options for their members facing financial hardship related to the flooding in the Midwest. “CMG MI offers credit union mortgage servicers a number of ways to provide relief to members in the declared disaster areas,” Brian Shepherd, senior vice president and general manager of CMG MI, said. “For example, at their discretion following consultation with CMG MI, servicers may reduce or suspend mortgage payments for up to 12 months for members with CMG MI-insured mortgages.” To help mitigate the impact of the flooding and preserve homeownership, CMG MI is instructing servicers of insured loans to work with members affected by the flood disaster to implement several relief measures, including:
* Forbearance on the member’s mortgage payments for up to 12 months; * No reporting of forbearance or delinquencies caused by the disaster to credit bureaus; * Suspension of foreclosure and eviction proceedings for up to 12 months; and * Suspension of termination of CMG MI-insured certificates for non-payment of premium by servicers.
“Helping these flood victims stay in their homes is CMG MI’s goal,” said Kathy Schroeder, senior vice president and general manager of CMG MI. “These homeowners need to focus on repairing the damage to their properties and rebuilding their lives. "CMG MI supports their efforts through the significant relief options available to our insured policyholders, which are modeled on those offered by Fannie Mae and Freddie Mac. We recognize that preserving homeownership is essential," Schroeder said. Contact Chris Eckenroad, CMG MI claims and customer service manager, at 800-909-4264, ext. 2539, or Mark Berkowitz, CMG MI’s vice president for operations and underwriting, at ext. 2504, for additional information on the company’s disaster relief effort. Eckenroad and Berkowitz will conduct case-by-case evaluations to establish payment alternatives for credit union members affected by the disaster.

PCUA OKs 100000 for Community Investment Fund

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HARRISBURG, Pa. (6/25/08)--The Pennsylvania Credit Union Association (PCUA) board approved an investment of $100,000 in the Community Investment Fund (CIF) in a three-year certificate, the association said yesterday (Life is a Highway June 24). CIF is the National Credit Union Foundation’s (NCUF) primary funding mechanism for national, state and local programs that benefit credit unions and their members. Investors in CIF, through their corporate credit union donate up to 2% of the dividend to NCUF, which dedicates up to 1% to national programs including:
* REAL Solutions, which helps credit unions offer new services to serve consumers who are struggling to save or build assets; * Biz Kid$, the first PBS-TV series devoted to youth financial education and underwritten by America's Credit Unions; * Credit Union Development Education, which promotes cooperative principles and credit union philosophy to make a positive impact in communities around the world; * Social Impact Management Institute, which makes the business case for social responsibility initiatives that meet a “triple bottom line” benefiting credit unions, their members, and their communities; and * Innovation Grants, which encourage credit union innovations through creative grant-making.
NCUF then grants up to 1% to the state credit union foundation or league in the state where each investment originated. States can use these CIF grants to:
* Educate credit union employees and volunteers; * Educate credit union members and potential members; * Support new credit unions, small credit unions, or community development credit unions; * Extend credit union services to their full fields of membership; * Fund affordable housing projects; * Enhance league projects with similar missions; and * Build a statewide credit union disaster relief reserve.

CUDL honors CUs for auto lending achievements

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LAS VEGAS (6/25/08)--CU Direct Corporation (CUDL) honored 12 credit unions Monday with the 2008 Best Practices Awards and Diamond Awards at its 10th Annual Auto Lending Symposium in Las Vegas.
Click to view larger image Pictured are the CU Direct Corporation (CUDL) Best Practice and Diamond Award winners (from left): Mike Chapman, Security Service FCU; Stuart Phillips, UBI FCU; Ken Carlson, University of Wisconsin CU; Diane Richard, Digital CU; Carl Roer, Sound CU; Craig Durkey, Redwood CU; Marti Rubino, Community First CU; Pete Van Graafeiland, Coastal FCU; Jenni Blair, First Tech CU; Eric Brotherson, Erie FCU; George Kite, Call FCU; and Cynthia Seymour, Tucoemas FCU. (Photo provided by CU Direct Corporation)
Awards were distributed in five categories:
* Business Development and Dealer Relations: Tucoemas FCU, Visalia, Calif., and Sound CU, Tacoma, Wash.; * Portfolio Growth and Risk Management: North Carolina Coast FCU, Raleigh, N.C., and First Technology CU, Beaverton, Ore.; * Marketing to Members: Call FCU, Richmond, Va., and UBI FCU, Plainville, Conn.; * Remarketing and Collections: Community First CU, Santa Rosa, Calif., and Redwood CU, Santa Rosa, Calif.; and * Marketing AutoSMART: Erie (Pa.) FCU, and University of Wisconsin CU, Madison, Wis.
Security Service FCU, San Antonio, Texas, and Digital CU, Marlborough, Mass., were honored with the CUDL Diamond Award for advancing their auto lending programs. CUDL, based in Rancho Cucamonga, Calif., provides indirect and point-of-sale lending services for credit unions.

MarylandDC foundation elects leaders

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COLUMBIA, Md. (6/25/08)--Lisa Jester, CEO of Central CU of Maryland, was elected as chair of the Credit Union Foundation of Maryland and the District of Columbia during its annual meeting May 19. She replaces immediate past Chair Rob Windsor, CEO, First Financial FCU, Lutherville, Md. Jester joined the board in 2003 and has served as vice chair for the past four years (Focus Newsletter June 23). Other officers elected include:
* Vice Chair, Windsor; * Treasurer, James Higbee, partner, Rowles & Co.; and * Secretary, Michael Beall, president of the Maryland and District of Columbia Credit Union Association.
Elected to three-year terms as directors were Bert Hash, CEO of Municipal Employees CU of Baltimore; Higbee; and Frank Taddeo, senior vice president, PFP Inc. According to foundation Executive Director Kyle Swisher, the foundation has provided more than $35,000 in funding the past four years to support the credit union movement through programs in financial literacy, credit union staff development and outreach to the underserved.

Filene research focuses on CUs most valuable asset people

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MADISON, Wis. (6/25/08)--Credit unions can learn how to optimize their operations through people with a new report from the Filene Research Institute. Filene recently held a colloquium at Loyola University in Chicago to examine the roles that compensation, human resource management and organizational development play in a credit union’s ability to create a culture of excellence that engages in exceeding members’ expectations. A report on the colloquium, “Building a Culture of Credit Union Excellence,” is available and features presentations by Paul Davis, president, Scanlon Leadership Network, about his Scanlon Plan. The plan aims to cut the worker in on the adventure, decisions and profits of increased production, and help management tap the ingenuity of employees as a means of improving production.
“The Scanlon Plan is one truly big idea that stands out,” said Denise Gabel, Filene chief innovation officer. “Employee participation, management and labor cooperation, collaborative problem-solving, teamwork and trust are all part of the elusive formula to overall organizational success.” Dow Scott, professor of human resources, Loyola University, and president of Performance Development International, argues that based on the Scanlon plan, an organization must meet the needs of three groups. He also describes the relationship between a culture of excellence and innovation. The report details a case study of Watermark CU, Seattle, which used the Scanlon process and is building on W. Edwards Deming’s principles to drive growth and generate revenue. Charles Cockburn, Watermark CU CEO, describes the changes the credit union made by eliminating standard incentives like employee-of-the-month awards and individual sales incentives. He also shares his gain-sharing formula, which uses a ratio of operating expense to gross income to measure increases in productivity. The plan develops baselines over three-year periods, creates pools of monies and attaches percentages are attached for payouts.

Wisconsin CUs provide relief to flood victims

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PEWAUKEE, Wis. (6/25/08)--Wisconsin credit unions are stepping up to help members affected by recent flooding in the state, according to the Wisconsin Credit Union League. Health Care CU, Oshkosh, is offering low-interest loans to help members. “We’re working with members on a case-by-case basis,” Pat Blades, Health Care CU president said. “We’re trying to find out what people’s needs are and how we can help them.” Oshkosh Community CU is offering several low-interest loans to help members, said Cathie Steiner, Oshkosh Community loan officer and marketing director. “Our members are waiting for help from their insurance and the Federal Emergency Management Agency, but they need the help now,” she said. “Most of these members had to throw everything out of their basements because of bacteria that could be in the water. So it’s been mostly members in need of washers and dryers and hot water heaters.” County-City CU, Jefferson, offered its members free debit cards. Fond du Lac CU is offering loans up to $5,000 per household with no payment or interest for 120 days. After 120 days, the members will get a discounted interest rate depending on their credit history. The credit union also is offering payment extensions on loans for up to three months. One Fond du Lac CU board member who volunteers with the American Red Cross overheard a woman saying she was grateful her credit union helped her get a loan, Fond du Lac CU President Chris Rockweit reported. Southshore CU, Cudahy, is accepting contributions for a relief fund for its former board chairman, Tom Pekar, who lost his home located on land between Lake Delton and the Wisconsin River when the lake drained. Westby Co-op CU suspended overdraft charges for two days for all members after the flooding, said Kevin Hauser, Westby Co-op president. “We realize that when people are trying to save their homes and belongings, they may not be thinking about getting a deposit to the credit union,” he said. The credit union suspended charges for a week in harder-hit areas and authorized loan payment extensions for up to three months. Staff at the credit union also help sandbag the area and volunteered at local shelters. The Reedsburg branch donated $200 to a local relief fund from their Causal for a Cause program, where employees contribute $1 each Friday to wear jeans to work.

Federation election results announced

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NEW YORK (6/25/08)--The National Federation of Community Development Credit Unions held its 2008 board elections at its Annual Membership Business Meeting in Dallas June 14. New board members are: Region 1: Shirley Spruill, CEO, Renaissance Community Development CU, Somerset, N.J.; and Region 4: Ginger McNally, Santa Cruz (Calif.) Community CU. Others elected include:
* Board chairman and Region 2 director: Eunice J. Rogers, CEO, NRS Community Development FCU, Birmingham, Ala.; * Vice chairman: Randy Chambers, chief financial officer, Self-Help CU, Durham, N.C.; * Treasurer: Helen Godfrey Smith, CEO, Shreveport FCU, Shreveport, La.; * Corresponding secretary and Region 3 director: Lynda Milton, CEO, Houston (Texas) Teamsters FCU; and * Recording secretary and Region 1 director: Deyanira Del Rio, chairman, Lower East Side Peoples’ FCU, New York.
Marvin Jensen, board member, Episcopal Community FCU, Los Angeles, was re-elected as a regional director to complete the remaining term of a vacancy in Region 4. For a complete list of the federation’s board of directors, use the link.

CU System briefs (06/23/2008)

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* DUBLIN, Ohio (6/24/08)--The Ohio Credit Union Foundation (OCUF) has disbursed a $5,000 Disaster Relief Grant to the Iowa Credit Union Foundation (ICUF) to assist credit unions and their employees, volunteers and members affected by flooding this month. It was the first disaster relief grant issued by OCUF in 2008. Becky Hart, OCUF executive director, noted that contributors from across Ohio "are proud to be able to provide this grant to the victims of the devastating floods, and we will continue to encourage additional donations from credit unions in our state." According to the CUAid.coop website, more than 20 credit union locations in Iowa closed in the current floods and many others were affected with outages. In 2007, OCUF provided $85,000 in disaster relief assistance to help victims of August floods in Ohio, California wildfires, and Peru's earthquake. OCUF's goal is to grant $250,000 in 2008, which is OCUF's 10th anniversary … * PROVIDENCE, R.I. (6/24/08)--Rhode Island credit unions have raised $50,000 for Special Olympics in various efforts. The latest, on May 30, saw more than 60 volunteers from 10 credit unions and the Credit Union Association of Rhode Island helping make the Special Olympics of Rhode Island Summer Games a success. Volunteers worked with the walking and running events, checking athletes in, gathering them into "heats" for their races and escorting them to the track. Mary Ellen Buckley, vice president branch operations at Westerly Community CU, serves on the association's Social Responsibility Committee, which coordinated the activities that the association undertakes to support the Special Olympics … * APPLETON, Wis. (6/24/08)--Appleton-based Prospera CU on June 18 opened a GoodMoney payday lending alternative inside Green Bay's newest Goodwill Store and Donation Center. The payday loan alternative will assist people with modest assets to secure loans they need in a more responsible manner, said Wisconsin State Treasurer Dawn Marie Sass. GoodMoney, launched in 2005 in Darboy by the credit union, has been featured in USA Today and The New York Times. It provides a more affordable short-term loan solution for payday loan users while offering them help so they don't need a payday loan in the future, said Ken Eiden, CEO of the $146.8 million asset credit union. Since Prospera and Goodwill launched the program three years ago, almost 11,000 GoodMoney short-term loans have been processed … * CINCINNATI (6/24/08)--Arthur S. Herring, husband of the late credit union pioneer Louise Herring, died June 14 at the age of 97. Funeral services were June 18. He was survived by five children--including William Herring, CEO of Cincinnati Central CU, and Catherine Herring, CEO of Communicating Arts CU, Cincinnati--and four grandchildren. Louise Herring is the namesake of the Credit Union National Association's Louise Herring Philosophy in Action Award … * NORTHVILLE TOWNSHIP, Mich. (6/24/08)--The Michigan Credit Union League has learned of the death of V. Ray Fradenburgh, former league director and retired general manager of Communicating Arts CU in Detroit (Michigan Monitor June 23). Fradenburgh died April 4 at the age of 90. He was a former chairperson of the Downriver and Bergengren credit union chapters. He is survived by his wife Jean; two sons, seven grandchildren and 15 great-grandchildren.

Federation honors Jacob Morrisey

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NEW YORK (6/24/08)--Two leaders of community development credit unions (CDCUs) received top honors at the National Federation of Community Development Credit Unions’ 34th Annual Conference on Serving the Underserved held in Dallas June 13.
(From left) Cliff Rosenthal, president/CEO, National Federation of Community Development Credit Unions, presents Ed Jacob, president/CEO, Northside Community FCU, Chicago, with a Vamper Award for his contributions to the credit union movement. Federation Board Chairman Eunice Rogers also helped to present the award.
Daniel Morrisey, treasurer and manager of Queen of Peace Arlington (Va.) FCU, speaks after receiving a Vamper Award from the federation. (Photos provided by the National Federation of Community Development Credit Unions)
The awards are named in honor of the late Annie Vamper, a pioneering African-American credit union manager, regulator and associated director of the federation. Ed Jacob, CEO, Northside Community FCU, Chicago, received the award for his work in developing alternatives to payday loans and helping immigrants. “I am proud and honored to be part of a movement that does this work, and to be able to send out a few of these tiny ripples of hope from Chicago,” he said during his acceptance speech. Dan Morrisey, treasurer and manager, Queen of Peace Arlington (Va.) FCU, received the award for his volunteer work, which spans more than three decades. His credit union is based in a church, and he believes that faith is important for all credit unions. “What we CDCUs, and really all credit unions, do day-in and day-out is to take a leap of faith in our members,” Morrisey said. “When we make loans we have faith that our members will repay that loan.” “Both Dan and Ed represent the best traditions of the credit union movement,” said Federation President/CEO Cliff Rosenthal. “With limited resources, they have made it their mission to stretch further to reach people in need--immigrants, people with disabilities, people who have been victimized by payday lenders. They have strengthened not only their communities but the CDCU movement nationwide.” Separately, the Federation honored Maurice Calderon, retiring senior vice president, minority development, Arrowhead CU, San Bernardino, Calif.; and Ralph Paige, CEO, Federation of Southern Cooperatives/Land Assistance Fund, Atlanta, with Friend of the Federation awards for their contributions to the credit union movement.

Workers comp experts tout benefits of education

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HOLLYWOOD, Fla. (6/24/08)--A commitment to safety and health in the workplace from top management and a proactive return-to-work program can help prevent workplace injuries and reduce the duration and cost of disabilities, workers’ compensation experts told credit union attendees at the Discovery Conference Friday.
(From left) Kurt Salter, account consultant, national market loss prevention, Liberty Mutual; Paul Bedrosian, service director, Liberty Mutual; and Fred Filiaggi, Midwest loss prevention manager, Liberty Mutual, and Jim Hunt, underwriting specialist, CUNA Mutual Group credit union protection division, discuss workers’ compensation issues at this year’s Discovery Conference. (Photo provided by CUNA Mutual Group)
Experts included Jim Hunt, underwriting specialist, CUNA Mutual Group credit union protection division; Kurt Salter, account consultant, national market loss prevention, Liberty Mutual; Paul Bedrosian, service director, Liberty Mutual; and Fred Filiaggi, Midwest loss prevention manager, Liberty Mutual. “Top management, supervisors, and all employees play a critical role in injury prevention,” Salter said. “Identifying causes for common workplace injuries and taking steps to mitigate those risks can greatly decrease incidents of injury.” Injuries caused by overexerting oneself through excess lifting or pushing was the most common cause of disabling workplace injuries in 2005, according to research by Liberty Mutual. CUNA Mutual’s claims data supports the findings, Hunt said. Employees moving 50-pound bags of coins often use two-wheel hand trucks. Those don’t work well, because bags tend to roll onto the floor. Dropped bags require employees to bend over and pick them up--which results in back and shoulder problems. The solution is to use low-profile, four-wheel carts and educate employees on proper posture and lifting techniques. Educational resources, such as CUNA Mutual’s Workers Safety Web page, should also be used, Salter said. When injuries occur, a supervisor’s response can play a key role in helping employees return to work, Filiaggi said. “Immediate response by supervisors to employees’ reports of work-related discomfort significantly influences length of disability.” Negative supervisor attitudes and practices can impede return to work and rehabilitation for injured employees. Employees often perceived that their supervisors:
* Blamed the employee for the injury; * Never contacted the employee after the injury; * Didn’t speak with the employee privately; * Discouraged the employee from filing a claim; * Didn’t believe the symptoms were real; * Were angry with the employee for being injured; and * Didn’t try to work out solutions with the employee.
Supervisors responding positively to reports of work-related discomfort can have significant and independent effects on disability outcomes, Filiaggi said. “It’s very important to communicate regularly and positively with employees. Show them that you care, encourage them and tell them you look forward to their return to work.” Supervisors trained to properly respond, communicate and problem-solve with employees reduced new disability claims by 47% and active lost-time claims by 18%. “Credit unions need to report claims quickly, help direct medical care and provide alternative duty to workers who can work, but can’t yet do all the functions of their everyday job,” he said. CUNA Mutual and Liberty Mutual partnered in 2007. Liberty is a compensation insurance provider and the second largest workers’ compensation insurer in the nation. The Discovery Conference ended Saturday.

SunCorp appoints exec committee

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DENVER (6/24/08)--SunCorp recently appointed three new members to its executive committee. “They each bring many years of credit union expertise coupled with SunCorp Board experience to their roles on the executive committee,” said SunCorp President/CEO Tom Graham. New members are:
* Chairman: Mark Lau, president/CEO, Denver Fire Department FCU. He previously served as senior vice president of retail delivery at Premier Members FCU, Boulder, Colo. He also served as president/CEO, Boulder Municipal Employees FCU from May 1991 to April 2002; * Shelley Clarke, president/CEO, Goldenwest FCU, Odgen Utah. She has served as president/CEO for 31 years. She also serves on the Credit Union National Association Governmental Affairs Subcommittee and the Filene Research Council; and * Kimberley Withers, president, Meridian Trust FCU, Cheyenne, Wyo. Withers has worked in the credit union industry since 1987, serving at Warren FCU, Cheyenne, and Cheyenne-Laramie County Employees FCU. She currently is vice president of Wyoming’s governmental affairs committee.
SunCorp, a corporate credit union, provides financial services and payment systems solutions to credit unions and credit union service organizations in 20 states.

Study of victims shows how to handle a data breach

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SAN FRANCISCO (6/24/08)--When a data breach occurs, what do consumers expect of their financial institution? A recent study indicates that offering a preventative solution for the future--without being asked to do so--helps ease any loss of confidence from a data-breach victim. Javelin Strategy & Research, a San Francisco based research of financial services topics, surveyed 400 data breach victims about their expectations for the breached institution. More than half (55%) of consumers who had experienced a breach expressed diminished confidence in the organization's ability to protect and manage their personal data. When consumer confidence is shaken, it weakens relationships with the institution, said Javelin's report. Fifty-six percent of data breach victims favor a solution that prevents fraud, Javelin said, who added that these efforts will help mitigate any decreased confidence related to a breach:
* Contact the member/consumer; * Create an audit trail that law enforcement can use; * Preserve the member/consumer's privacy; and * Prove that the solution works.
Providing a fraud solution makes a difference in customer approval of a breached organization's management and handling of the incident, said Javelin. Of those who were offered a fraud protection solution, 55% were more satisfied with the institution's handling of the incident than were consumers who were not offered the solution. Javelin made these recommendations:
* Given the variety of fraud-protection solutions and their varying features, engage in comprehensive research of the services available to understand how they play a role in prevention, detection and resolution of fraud. * Select a solution that is convenient and easy for the breach victim, both in terms of enrollment and use, with an understanding of the impact on prevent new accounts fraud. * Understand that offering a breach solution is a "best practice" from a member/customer service standpoint. Avoid creating a situation in which members and/or employees have to ask for fraud protection assistance. Take the proactive approach and offer the assistance up front.
For more information, visit the resource link.

BizKid topic of WGN radio interview

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NAPERVILLE, Ill. (6/24/08)--BizKid$ will be the topic of a radio interview on WGN, one of Chicago’s largest talk radio stations, Saturday. BizKid$ kid Lizzie Wright and show executive producer Jamie Hammond will be guests on “The Money Show” with host Bill Moller from 1 p.m. to 1:30 p.m. CDT. WGN radio reaches 38 states and is live-streamed over the Internet, according to the Illinois Credit Union League. Wright was featured in BizKid$ episode No. 9, titled “Cash and Credit.” She is a creative designer and makes her own clothing. Wright brings her sewing machine to work during downtime on the set. Her specialty is altering prom dresses. BizKid$ is a television series designed to teach youth about money. It is produced by the creators of “Bill Nye the Science Guy” and features stories about young entrepreneurs, reinforcing the importance of budgeting, saving and giving back to the community. Twenty-six episodes have been produced. The show was developed by the Washington Credit Union League in partnership with Junior Achievement and WXXI Public Broadcasting in Rochester, N.Y. America’s Credit Unions and the National Credit Union Foundation provided funding for the show. BizKid$ currently airs on 311 of the nation’s 343 PBS stations and is airing in the United Kingdom and in Ireland.

Altura CU receives Bergengren award

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HOLLYWOOD, Fla. (6/24/08)--Altura CU, Riverside, Calif., is the 2008 recipient of CUNA Mutual Group’s Roy F. Bergengren Award. The award, named for the credit union pioneer, was presented Saturday at the closing session of CUNA Mutual’s 2008 Discovery Conference. It recognizes individuals and credit unions that exemplify credit union movement leadership, financial growth, human resource development, and innovation.
Altura CU President/CEO Mark Hawkins accepts the Roy F. Bergengren Award at CUNA Mutual Group's annual Discovery Conference. CUNA Mutual Board Chairman Loretta Burd and Chief Sales Officer Bob Trunzo are in the background. (Photo provided by CUNA Mutual Group)
Altura opened its doors 51 years ago and ended 2007 with more than $1 billion in assets and nearly 112,000 members. “We pride ourselves on being actively involved in the credit union movement by enhancing our employees’ professional development, educating our members on credit union advocacy issues and being a positive influence in our community," said Mark Hawkins, president/CEO of Altura. "This award validates all our hard work.” The credit union is a leader in the development and training of staff in the principles and philosophy of credit unions and has been named a "Top Company to Work for in the Inland Empire" and the "Best Company to Work For" by regional publications and their readers. Altura ranks member service as the No. 1 way it differentiates itself from the competition. It offers online banking, Web bill pay, e-statements, online banking demonstrations, investment portfolio, and eVISION online trading. It also provides small-business services including lending, checking, and savings options geared for business. The credit union supports its community through contributions of more than $300,000 annually, and time and energy. It supports education-related causes, including youth efforts, and provides scholarships, teacher awards, essay contests and financial literacy projects. The credit union also supports employees’ volunteer efforts. Last year, its employees volunteered more than 2,000 hours in the community.

Benefits plans can help CUs keep top execs

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HOLLYWOOD, Fla. (6/23/08)--Credit unions face challenges recruiting and retaining talented executives in a competitive marketplace, but several available executive benefit plans can help resolve the issue, Rick Boothby, executive benefits specialist for CUNA Mutual Group, told Discovery Conference attendees Thursday. Boothby explained the types of benefits that non-profit and tax-exempt organizations can offer to key executives are limited by specialized tax rules under Section 457 and Section 409A of the Internal Revenue Code. “The good news is these limits are not the end of the story for credit unions. Fortunately, alternate plan designs are available for non-profit, tax-exempt organizations, which are not governed by Section 457 or 409A,” Boothby said. “Understanding how these alternate plan designs work can help credit unions recruit, retain, reward and retire top talent.” Credit unions may offer one of five non-qualified retirement benefit plan designs, depending on executives’ needs:
* Section 457(f) plans; * Split dollar loans; * Split dollar loan/457(f) combo arrangements; * Executive bonus plans; and * Restricted executive bonus arrangements.
CUNA Mutual has implemented tailored executive benefit programs at about 1,600 credit unions, but that is less than one-fifth of the approximately 8,300 U.S. credit unions today, said Boothby. “With the volatility in the banking industry, we’ve seen an increase in the number of credit unions implementing 457(f) plans as a ‘golden handcuff’ or ‘glue in the seats’ tactic for retaining key executives. Credit union executives are contacted daily by head hunters offering positions in larger credit unions or other businesses outside the credit union industry,” he said. “Many executives leave, lured by attractive executive benefit plans offered by competitors,” Boothby added. “In many situations, a supplemental executive retirement plan is written into the pre-employment offer letter to provide 50% to 80% of the executive’s future retirement income.” To keep their credit unions competitive with other organizations, credit union board members must provide executives with incentives to remain with the credit union, Boothby stressed. The best plan-design will be based on mutually desired features, Boothby said. In addition to attracting and retaining valuable executives, an executive benefit plan can help the credit union because it counters existing benefit package shortfalls, has minimal impact on the balance sheet, and is easy to establish and maintain. “Credit unions should identify their most valuable executives and determine the effect on the credit union if those employees were recruited elsewhere. Then, design an appropriate benefits solution to ensure that does not happen,” Boothby concluded.

Kansas CU regulator Assets loans members are up

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WICHITA, Kan. (6/23/08)--Assets, loans and membership for credit unions in Kansas are up for the first three months of 2008, putting the state's credit unions in good shape, according to the state regulator. Data from the Kansas Department of Credit Unions for first quarter 2008 show increases in all three areas (Wichita Eagle June 19). Total assets rose 9.6% to $3.19 billion in first quarter 2008 over the same period in 2007. Loans totaled $2.13 billion, up 6% over the period last year. Credit union membership increased 2% to more than 513,000 members. KDCU Administrator John Smith noted the gains in membership and assets may be because consumers are depositing savings instead of investing in the stock market, the newspaper said. Loan delinquency amounts rose more than 20% to $23 million from $19 million since first-quarter 2007. However, they dropped 12.8% or $3.4 million between fourth quarter 2007 and first quarter 2008. The number of credit unions dropped to 87 from 90.

Kenyan bill would block CUs from money transfers

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NAIROBI, Kenya (6/23/08)--A bill under discussion in the Kenyan Parliament would bar Kenya's savings and credit cooperative societies (SACCOs or credit unions) from the money transfer business and from wholesale or retail trade or investments in enterprise capital to diversify their revenue. SACCOs rely on the retail or wholesale business to grow revenues to earn dividends for members, said All Africa (June 19). Money transfers activities is one of the most popular services SACCOs offer. Commercial banks are pushing the proposed law, which would narrow SACCOs' investment choices and force them to concentrate more on small self-help loans they are noted for, said the article. Most SACCOs run legitimate businesses but some have non-core activities--such as running restaurants, bars, office blocks and matatu fleets--that generate pyramid schemes, the article said. According to Carilus Ademba, managing director of the Kenya Union of Savings and Credit Cooperatives (KUSCCO), a trade association for credit unions in Kenya, outright barring of SACCOs from operating money transfers will limit their growth and give an advantage to banks. Last year, the World Council of Credit Unions and KUSCCO signed a partnership for a joint international fund transfer facility to enable member credit unions to start international money transfer operations through the Vigo money transfer plan. The transactions are seen as possible growth drivers, said the article. KUSCCO is lobbying to amend the bill and said Kenya's minister for cooperative development supports KUSCCO's proposed amendments.

CU System briefs (06/20/2008)

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* WINNIPEG (6/23/08)--Computer problems shut down service at credit unions in Manitoba Thursday, preventing members from withdrawing money from their accounts through ATMs (CJOB 68 June 20). An information technology company was servicing the Interac system when the problems began Thursday morning. Although the system was back up by Friday, Assiniboine CU was still without the service Friday and was working to solve the glitch … * CANTON, N.C. (6/23/08)--Three credit unions in North Carolina set up accounts to benefit the family of slain Highway Patrol Trooper and credit union member David S. Blanton, 24, who was murdered last week during a traffic stop. Blanton was a member of Mountain CU, and his wife, Michaela Layman Blanton, was a former employee of Champion CU. They have a newborn son. The credit unions and Raleigh-based State Employees' CU, which includes the Highway Patrol in its field of membership, have created accounts for the family. A Florida man, Edwardo Wong II, 37, has been charged with first-degree murder. Wong faces the death penalty in the slaying (Citizen-Times June 19) … * LOUISVILLE, Ky. (6/23/08)--Counterfeit cashier's checks circulating in Kentucky bear the name of Louisville-based L&N FCU, says a Federal Deposit Insurance Corp. alert. The items are circulation in relation to a secret shopping scam. L&N FCU does not issue cashier's checks, but does offer official checks. The counterfeit items bear a routing and transit number--011007092--assigned to Boston (Mass.) Safe Deposit and Trust Co. L&N FCU's official checks are issued by Moneygram Payment Systems, a Minneapolis, Minn.-based service through an account at the Boston company … * RANCHO CUCAMONGA, Calif. (6/23/08)--The Richard Myles Johnson (RMJ) Foundation has presented two community service grants totaling $22,500 to several Bay Area credit unions for financial literacy efforts. A $20,000 grant will help launch the San Francisco Chapter Financial Literacy Consortium Project--a partnership between eight credit unions and San Francisco Unified School District's School-to-Career Program, Academy of Finance. Credit unions partnering with the consortium project are: Patelco CU, Bay Media FCU, The Golden 1 CU, McKesson Employees FCU, Redwood CU, SF Fire CU and Spectum FCU. The project will establish multi-lingual, multicultural credit union financial literacy programs to reproduce Mission SF CU's Youth CU Program, a youth-operated credit union, at the district's 17 high schools. Also, Jones Methodist Church CU, San Francisco, received $2,500 to continue its Financial Boot Camp for youth in the local area. … * WARRENVILLE, Ill. (6/23/08)--Jay Petty of Carlsbad, Calif., has joined Members United Corporate FCU as a senior business consultant serving credit unions in California. Petty previously was business development consultant/member services officer with CUNA Brokerage Services, a broker/dealer subsidiary of CUNA Mutual Group. He also has served as president/CEO of Pentagon Federal Financial Services …

Mid-Atlantic Corporate elects officers honors retiring CEO

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HARRISBURG, Pa. (6/23/08)--Mid-Atlantic Corporate FCU re-elected three directors to its board during an annual meeting Thursday night. Officers re-elected include:
* Joan Moran, CEO, Department of Labor FCU, Washington, D.C.; * Mike Pastirik, CEO, United Community FCU, West Mifflin, Pa.; * Connie Wheeler, CEO, Penn State FCU, State College, Pa.
Ed Fox, retiring CEO of Mid-Atlantic Corporate FCU, also was honored during a special reception Thursday night in Gettysburg, Pa. More than 200 credit union leaders gathered to celebrate his retirement. Fox will retire on July 31. Jay Murray will assume the role as CEO in August (Life is a Highway June 19).

Membership Growth Series CES CU

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MOUNT VERNON, Ohio (6/23/08)--Autonomous, small branch growth and focused indirect lending are two keys to 9.5% membership growth in the past year for CES CU, a $115 million asset, Mount Vernon, Ohio-based credit union. The credit union experienced about 27% membership growth over the past five years, conducting business in very rural community in Knox County, Ohio. The county has a total population of about 57,000, CES President/CEO Kelly Schermerhorn told News Now. This is the fifth installment of the News Now 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. 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. “We have a strategy of core membership growth,” Schermerhorn said, referring to one facet of CES’ multi-pronged growth strategy. “We try to extend our reach by opening small branch offices with three, four or five employees. We opened one 18 months ago and are looking to open another in 30-45 days. We then will have five total branches. We’ll have a physical presence in four out of five counties that we operate in when we open the new branch.” Ohio has a very growth-friendly state charter in which a county can count as a select employee group, Schermerhorn explained. “Our strategy is, instead of waiting to grow $30 million to $50 million to open a big branch, we’re opening smaller branches to bring in business,” he added. Growth through branch expansion is a key part of CES’ growth strategy. “We have a decentralized style of management so the span-of-control issue is overcome, because the branches have a lot of autonomy,” Schermerhorn said. “We’re too small to be big, and we’re too big to be small,” he continued. “We don’t have the economies of scale of bigger credit unions, and we don’t have the extent of personal relationships that smaller credit unions have. We’re in the middle.” That middle point is where many credit unions spin out of control because they aren’t sure what to do, Schermerhorn said. “Our success with our growth strategy is because of the independence of our branches in setting their agenda,” he said. “We give them goals, but the branches decide how to accomplish them.” Indirect lending is the other key component of CES growth. “There is a national bias against indirect lending,” Schermerhorn said. “Most think of it as a monster.” “My advice is, if you’re trying to service 27 auto dealers, you’re going to be the No. 4 or No. 5 choice on their list,” he said. “We have five dealers that we have a close personal relationship with. My associate vice president of lending knows all of those dealers. He spends as much time in their office as he does in mine. So we’re the No. 1 choice on the lists of five dealers instead of being the No. 4 choice or less at 27 dealers.” This also results in a good span of control with indirect lending, Schermerhorn said. “We don’t care if we do business with any other dealers. We have a strong relationship with the finance and insurance officers at five dealers. That’s what sets us apart," he added. Still, Schermherhorn admits it can be hard to convert indirect members to active members. Although CES is "not very good yet at going after younger members," Schermerhorn, along with CES’ vice president of lending operations, and its director of marketing met with an area college president about placing an ATM on campus. "However, he wants us to put a branch on campus and have direct access to students,” Schermerhorn said. CES will pursue the opportunity, Schermerhorn added. “If you don’t get them by age 25 as members, you likely will never really have them,” he said. One idea that CES has put to use was derived from the Filene Research Institute’s i3 program, called “prize-based savings.” Every month, CES gives away $5,000 to a member in a random drawing. Every dollar a member has in savings at CES is a chance to win the drawing. CES’ certified public accounting firm has random selection software and documents the drawing. The first winner was a 12 year-old girl, Schermerhorn said. “We got great press coverage out of this in the local paper,” he said. “It’s like free advertising.” The $60,000 per year in prize giveaways has been more than offset by an increase in core savings of $1.7 million at CES in the first five months this year. “More people are saving, and although I can’t empirically link the increase directly to the monthly $5,000 giveaway, I knew that we are counter-cyclical--in that our core savings are going up rather than down.” Anyone who wants to contact the CUNA Membership Growth Task Force can e-mail the account established for this purpose at cunamgtf@cuna.coop.

CU fin educators receive Virginia league awards

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LYNCHBURG, Va. (6/23/08)--The Virginia Credit Union League presented awards to a credit union and two credit union professionals for their financial literacy efforts.
Click to view larger image Arlington Virginia CU staff (from left) David Romney, Diane Reed, Patty Browne and CEO Brenda Turner received the Virginia Credit Union League’s Visionary Award from and Dawn Lindley, league director of marketing and financial literacy.
Click to view larger image Cherry Hedges (left), financial education director at Virginia CU, received the Class Act award from Dawn Lindley, Virginia Credit Union League director of marketing and financial literacy.
Click to view larger image Kristina Benson (left), Fore Lee FCU, received the Credit Union Youth Advocate of the Year award from Dawn Lindley, Virginia Credit Union League director of marketing and financial literacy. (Photos provided by the Virginia Credit Union League)
Arlington Virginia FCU received the Visionary Award for its work in providing personal finance education in the community. During the past year, the credit union created three programs to address the needs of Latino youth, adults striving to attain or regain self-sufficiency and students lacking basic finance skills. The credit union partnered with two school clubs--Latinas Leading Tomorrow and Latinos en Accion--teaching their members about savings accounts, interests, deposits, withdrawals and checks. More than 50 students participated in the after-school programs, the league said. Arlington Virginia CU also partnered with Vanguard Services UnLtd., a community organization that helps adults overcome substance abuse. About 15 “Financial Recovery” workshops were offered to 57 individuals. The credit union opened a new student-run branch, bringing its student-run branch total to five. Cherry Hedges, financial education director, Virginia CU, Richmond, received the league’s Class Act award. The award recognizes a credit union professional for achievement as a financial literacy educator, including school and community outreach. Hedges taught more than 20 financial education courses at Virginia Commonwealth University and at three community colleges. She also was recognized for creating a personal finance curriculum for high school students, Smart Start, which incorporates the state’s learning standards with financial education. Kristina Benson, Fort Lee (Va.) FCU, received the Credit Union Youth Advocate of the Year award. The award recognizes a credit union professional or volunteer for outstanding individual contributions to the credit union movement, specifically in promoting legislation for personal finance education in schools, and the sharing of cooperative resources to further financial education and community outreach. Benson taught more than 850 students during the 2007-2008 school year. She contacted all local school superintendents and offered to assist teaching personal finance basics. She also volunteered at Fort Lee’s “Jump In and Save” campaign, launched last year to encourage savings and the development of personal budgets.

CUNA Mutual pilot How to engage indirect borrowers

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HOLYWOOD, Fla. (6/23/08)--To help credit unions turn “one-and-done” indirect borrowers into long-term, profitable members, a CUNA Mutual Group pilot yielded results and several findings from which credit unions can build strategies, according to a recently published white paper. “Developing Members from Indirect Borrowers: Lessons Learned” provides insights into how 13 pilot credit unions built multi-product relationships with members through a dedicated call center staffed with trained, full-time outbound-call representatives. Results of the four-month pilot were presented at CUNA Mutual’s Discovery Conference this week. “By investing resources to help credit unions deepen relationships with indirect borrowers, CUNA Mutual sought to address one of the industry’s biggest lending challenges,” said Heather Thiltgen, vice president, consumer programs, CUNA Mutual. “The pilot identified ways credit unions could engage indirect borrowers by introducing other credit-related products to meet their needs and save them money.” The most successful product offered to indirect borrowers in the pilot was a line of credit, which had a 28% sales rate. Credit cards netted a 17% sales rate and auto refinances had a 15% rate. The average line of credit was $2,098; credit cards, $5,005, and auto loan refinance, $16,140. Key findings from the pilot included:
* Members welcome phone calls from their credit union. Outbound call representatives received positive responses from members when they identified themselves as representatives of the credit union; * The phone call has a relationship-building effect even if the initial call doesn’t deepen the relationship; * The pilot’s pre-screening process enabled credit unions to obtain a member profile with data that helped match products to member needs; and * Credit unions can find success with outbound calling in indirect auto lending. New members view it as a personal touch.
Amplify CU, the pilot’s early adopter, derives 50% of its new membership through indirect borrowers. The Austin, Texas-based credit union has $465 million in assets and 42,000 members. “The pilot was very well done in that CUNA Mutual devoted proper resources, time and energy that delivered a program from which we could all benefit,” said Pierre Cardenas, Amplify’s senior vice president--retail. “The most interesting outcome for us was that call center personnel who weren’t our employees were just as effective as our employees. Our members responded very positively, which indicates outsourcing this in the future might be worth considering.” To deepen relationships with indirect borrowers, Thiltgen recommended credit unions implement some of the best practices CUNA Mutual incorporated into the pilot, including:
* Dedicating resources to make the program successful; * Verifying regulatory compliance surrounding use of credit data; * Obtaining necessary technology/systems support; * Tracking results; * Pricing for the relationship; and * Remembering that auto loans are seasonal and considering other outbound opportunities such as new-member onboarding programs.
“The pilot produced some interesting results on what appealed to indirect borrowers, such as, the success of an auto-loan closing was best when the member saved at least $20 a month,” said Thiltgen. “Also, those with higher credit scores were least likely to accept card offers, and line of credit offers were the most successful, which might be related to the sense of security it creates ‘just in case’ something happens.” “Above all, the pilot validated that our outbound-calling strategy to rein in these new members was on the right track,” added Cardenas. “This proactive approach to onboarding indirect borrowers is the wave of the future. Credit unions can’t afford not to engage these members or any other new members coming from other channels, for that matter.”

Demand rising for long-term care insurance

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HOLLYWOOD, Fla. (6/23/08)--With the need for long-term care remaining the greatest unfunded liability a person can face in retirement, long-term care insurance is one of the most sought-after executive benefits today, attendees of CUNA Mutual Group’s Discovery Conference were told Friday.
Michael McNerney, senior long-term care specialist, CUNA Mutual, discussed how long-term care can act as umbrella protection for a person’s accumulated benefits at last week’s Discovery Conference in Hollywood, Fla. (Photo provided by CUNA Mutual Group)
Long-term care involves a variety of services that helps meet the medical and non-medical needs of people with a chronic illness or disability who cannot care for themselves for extended times. Other significant risk factors are covered by various forms of insurance--health, home and vehicle--but long-term care is not widely insured. Yet the need is real and growing, said Michael McNerney, senior long-term care specialist for CUNA Mutual. “As many as 70% of people over age 65 receive some home care, and the average cost of nursing home care is $195 per day,” said McNerney. “An unexpected need for long-term care, either for the executive or a family member, can virtually wipe out an entire lifetime of savings.” Credit unions faced with increased competition for talented key executives can offer long-term care as part of an executive benefit plan. “Long-term care is an innovative benefit that is becoming expected. In a 2001 survey, 17% of respondents included long-term care insurance in executive benefit packages. By 2007, that number rose to 27%. An increase of 10% in that timeframe is extremely significant,” McNerney said. Yet the majority of credit unions today do not offer long-term care insurance. This is a concern, McNerney said, because most retirement projections do not take the possible need for long-term care into consideration. “For the executive, long-term care insurance completes a lifetime of retirement planning, acts as an umbrella of protection over other accumulated benefits and provides for the entire family if care is needed,” McNerney said. “For the credit union, long-term care insurance can be used as a tool to reward and retain key executives, is a flexible benefit component and costs only pennies on the dollar,” he added. The federal government is taking steps to encourage workers to invest in long-term care insurance by setting favorable tax treatments of long-term care benefits. The benefits are not taxable as income and the premiums may be deductible as a medical expense. The government has set these tax advantages to help relieve a strain on Medicare, Medicaid and Social Security, McNerney said.

Hill re-elected as NCCUL board chairman

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GREENSBORO, N.C. (6/23/08)-- The North Carolina Credit Union League has re-elected Ben Hill, manager of Blue Flame CU, Charlotte, N.C., as chairman of its board of directors. Hill was elected during the league’s 73rd annual meeting in Pinehurst, N.C. The board also announced the officers slate for 2008-2009:
* Vice chair: Maurice Smith, president/CEO, Local Government FCU, Raleigh; * Treasurer: Jeff Jones, president/CEO, Freedom FCU, Rocky Mount; * Secretary: Patty Idol, president/CEO, Mountain CU, Waynesville; and * Executive officer: Bill Flowers, CEO, Carolinas Telco FCU, Charlotte.

Speaker Reg changes add to tough lending landscape

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HOLLYWOOD, Fla. (6/23/08)--Credit unions can continue to expect regulatory changes while in the throes of a difficult lending environment, but some changes may present
Bill Klewin of CUNA Mutual Group updated Discovery Conference attendees last week on key lending regulatory issues. (Photo provided by CUNA Mutual Group)
opportunities, attendees at the CUNA Mutual Group's Discovery Conference were told Thursday. "The lending environment is difficult now, and part of that is increased regulatory scrutiny, but there are some positives,” said Bill Klewin, associate general counsel, CUNA Mutual. “First, with 11% capital, credit unions have money to spend. It’s an excellent time to invest in technology to take apps, close loans and embrace electronic signatures to meet the needs of your next generation of lenders.” Klewin updated attendees on regulatory issues important to credit union lending, including:
* Truth in Lending (Regulation Z)--The Federal Reserve Board’s 2007 proposal could have a harmful effect on multi-featured open-end lending. It would change the way about 3,500 credit unions do lending based on Truth-in-Lending. Credit Union National Association and CUNA Mutual officials have proposed alternatives to the Fed proposal, emphasizing the harm this proposal would cause credit unions. * RESPA--Housing and Urban Development’s (HUD) Real Estate Settlement Procedures Act (RESPA) would result in significant change to how the closing process works. The regulation likely would result in a requirement for the ability to perform underwriting earlier in the lending process. It assumes closings would occur in a face-to-face environment. Final regulations are expected in early 2009. * Unfair Deceptive Acts and Practices Rule--The regulation would prohibit certain activities with credit cards and overdraft protection programs. Credit unions and others would be unable to raise rates on existing balances based on changes in a member’s creditworthiness. “This could be a big deal from a safety and soundness standpoint,” Klewin said. “The net result is a credit union may not get the kind of return on its portfolio that it is today.”
E-signature legislation, which passed in 2000, has not been fully embraced by the financial services industry, Klewin said. The e-commerce legislation provides e-signatures with the same force as a paper contract. However, uncertainty over technology and security has limited its use by many credit unions and banks. Klewin added the legislation affords credit unions an opportunity to prepare for the expectations of future borrowers. “The new generation of borrowers, Gen Y and younger Gen X’ers, will insist on this technology. It would behoove credit unions to look into how this technology can be integrated into their future business plans. “With continued lending uneasiness, increasing competition and a dynamic regulatory environment, changes will keep challenging your operations, marketing and sales,” Klewin said. “Be aware of some of those changes that may be coming and take action that will prepare you better for the future.” The conference, in Hollywood, Fla., ended on Saturday.

U of Iowa Community CU to match flood funds

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IOWA CITY, Iowa (6/20/08)--University of Iowa Community CU will conduct fundraisers and collect contributions for victims of flooding in the Iowa City/Coralville area and it will match some of the funds raised. The credit union's board met Tuesday to brainstorm ways the credit union could help the community and its members in the wake of last week's flooding in the state. Credit union staff will raise money through a variety of fundraisers such as car washes, hot dog lunches and bake sales at its branches. Donations also will be accepted from the public. The credit union will match the funds raised up to $5,000, it said in a press release Tuesday. The funds will be directed to the Iowa City/Coralville Flood Relief Fund through the United Way of Johnson County. The credit union closed one branch, located in the university's Student Memorial Union, when the university campus was flooded last week. Officials estimated that the branch had three feet of water (News Now June 17). "In the aftermath of flooding in the Iowa City/Coralville area, we're pleased to be able to help those affected as it fits in well with the credit union philosophy of 'people helping people,'" said Jeff Disterhoft, president/CEO of the $619.2 million asset credit union.

California league warns of vishing scam

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RANCHO CUCAMONGA, Calif. (6/20/08)--Credit unions and their members were being warned about a vishing scam making the rounds in San Jose and the Bay Area, according to a local journal. The California Credit Union League warned that the new scam involves a telephone message indicating that the call is from "your credit union" and that the recipient's account number or credit card number has been used illegally (Silicon Valley/San Jose Business Journal June 18). The vishing telephone call asks the victim to call a fake 800 number to "verify" information such as account number, security code, Social Security number and place of birth and reinstate the account. Credit unions in the area received reports from members and non-members about the recorded calls and have posted information on their websites to educate members about the scam, said the newspaper. The league reminded credit unions that they should continually educate members about scam with tips such as these:
* Don't call the number provided in a phone call or voice message. Instead, call the number on the back of the credit card or on a billing statement. * If the caller poses as a financial institution and asks for a credit card number or the three-digit code on the back of the card, hang up and call the phone number on the back of the card to report the attempt. * Be cautious when dialing a call return number or replying to an e-mail about a financial matter. * Credit card companies normally refer to customers by their full name in any communication. An e-mail or telephone call that doesn't use a full name may be a scam.

New Mexico CUs honor three colleagues

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ALBUQUERQUE, N.M. (6/20/08)--The Credit Union Association of New Mexico honored three credit union representatives for their service and presented them awards at the association’s annual convention June 6. Harold Dixon, CEO, State Employees CU, Sante Fe, received the Mel Romero Outstanding Professional Award in recognition of his years of leadership and dedication. Under his tenure, deposits grew at State Employees to $177.2 million from $79.1 million, assets to $197 million from $89 million, and membership to 29,556 from 21,586 in five years. Dixon also serves as treasurer on the CUANM board of directors. Burton Clyde, chairman of the board of directors at Sandia Area FCU, Albuquerque, was given the Ed Twibell Outstanding Volunteer Award. Clyde held the position as board chairman for 13 years, leading the credit union through the unexpected death of its CEO in 2005, tripling the membership, and keeping pace with changes in financial services and its technology. Susan Clem, manager of The Florist FCU in Roswell, was named to the Ron Moore Hall of Fame after an unprecedented number of nominations. She started her career in 1975 and has been manager for 23 years. She contributed to her credit union’s growth and stability by staying updated on new products, services and technology, and traveling extensively to provide service to members spread over a large geographical area.

Speaker Ignore boomers needs and CUs relevance erodes

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HOLLYWOOD, Fla. (6/20/08)--To stay relevant, credit unions should care about and prepare for the surge of baby boomers converging on retirement, attendees of CUNA Mutual Group’s Discovery Conference were told Thursday.
Scott Knapp, CUNA Mutual Group’s vice president, retirement services and strategy, speaks about baby boomers’ retirement needs to Discovery Conference attendees Thursday in Hollywood, Fla. (Photo provided by CUNA Mutual Group)
“To not have a strategy for the largest generation in U.S. history will lead to erosion of a credit union’s relevance and economic viability,” said Scott Knapp, vice president, retirement services and strategy, CUNA Mutual. “This is a matter of importance that should be addressed at the highest level of the credit union.” Members nearing retirement are “scared to death” about not having enough money during retirement and that society has “over committed” to baby boomer retirement and won’t be able to deliver on many benefits, Knapp told Discovery Conference attendees. In a Gallup poll, 63% of baby boomers said they were concerned about not having enough money for retirement, and more than half were worried about not being able to pay for medical costs. The majority of people are not saving the right amount for retirement, he added. “That’s the easiest part of preparing for retirement, but few are getting it right. The hardest part is converting that accumulation of assets in order to sustain your retirement years. Building that plan is hard,” Knapp said. Credit unions need to step up and help members against some of the major retirement risks, including how to avoid outliving their money, taking out too much, needing money for health care and protecting against inflation, Knapp said. “Credit unions of all sizes need to play some role in helping those members through the difficult part. Position your credit union as a retirement resource center, providing investment, insurance and other services that address the retirement risk and management challenges,” Knapp said. “Adopt a comprehensive retirement strategy, communicate it to employees and train them to help members address their retirement needs,” he continued. “Partnering with a vendor to offer a product menu during your members’ pre-retirement years is a good way to address these challenges ahead of time.” Credit unions can grow membership by offering retirement planning services to their select employee groups (SEGs) before employees’ retirement, Knapp said. He also recommended offering 401(k) programs to those employers as a way to establish a long-term, sustainable relationship with the SEG. “A strategy to address your members’ retirement needs is crucial, or at retirement they will walk out of your branches forever,” Knapp said. “This is an issue that affects your capital investment strategy, marketing, distribution--and essentially the future of your credit union.”

Ohio governor signs CU modernization act

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COLUMBUS, Ohio (6/20/08)--Ohio Governor Ted Strickland signed a credit union modernization bill into law on June 11, according to the Ohio Credit Union League (OCUL). Senate Bill 247 updates regulations regarding state credit union operations, administration and governance. It will take effect Sept. 9 (eLumination Newsletter June 18). Under the new law, written ballot approval will no longer be required when a ballot is necessary, within guidelines. It also provides for record retention time periods and additional flexibility in credit union mergers. The law adds language similar to that of the federal law requiring criminal background checks for people with a substantial interest in or who participate in the management of a financial institution when there is a newer application, change in control, or supervisory action. It also reviews appointments based on asset size for the Ohio Credit Union Council with a member of a credit union less than $35 million and $50 million. League General Counsel John Koslowski told the newsletter that the league was pleased by the measure's bi-partisan support in the state legislature and by "the increased flexibility and ability credit unions will have to operate more efficiently so they can focus on serving their members."

Fla. Ala. leagues discuss combining collaborating

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TALLAHASSEE, Fla. (6/20/08)--The Florida and Alabama Credit Union Leagues have entered into early discussions to explore a combination of or closer collaboration between the two leagues. The announcement Thursday was made by Florida league Chairman Rich Helber and Steve Swofford, chairman of the Alabama league. The discussions aim to bring greater level of services to both states' credit unions and to create efficiencies and greater strength. "Each league enters these discussions with an open mind about the potential resulting structure that would best serve credit unions in their states," said a press release. The discussions are linked to the retirements of the leagues' long-time league presidents Alabama's Gary Wolter and Florida's Guy Hood. With their upcoming retirements, leadership in each state believes that a great opportunity exists to build on the successes each state and deliver services and gain efficiencies through some form of combination, said the press release. Swofford and Helber stressed that the discussions are in the "very early phases" and a "thorough analysis" will be made. The leagues have a history of working together. They have retained Tom Olson, president, Directions 21 Business Group, to assist them.

Reach Out Set for October conference

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MADISON, Wis. (6/20/08)--Credit union professionals can learn how to serve low-wealth individuals, immigrants and youth during the “Reach Out! Conference: Strategies for Serving Low-Wealth, Immigrants, and Youth” Oct. 12-15 in San Francisco. The conference is presented by the Credit Union National Association (CUNA) and the National Credit Union Foundation (NCUF). The conference will provide information about the three target groups, including demographics, financial services needs, challenges and best practice ideas for reaching them. Experts from NCUF, CUNA, the Filene Research Institute and the National Federation of Community Development Credit Unions will offer advice on serving the markets. Credit union professionals also will learn how to respond to the potential business threat presented by Wal-Mart stores entering the financial services arena. Wal-Mart’s technology to offer products and services to low-wage families will be discussed. Attendees will learn about NCUF’s REAL Solutions program. The latest information from the REAL Solutions Impact Center will be provided. For more information, use the link.

Two indicted in CU shootout that killed third suspect

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NILES, Mich. (6/20/08)--Two men have been indicted in connection with an armed robbery and shootout Jan. 18 at the Niles, Mich., branch of Berrien Teachers CU. A third suspect died in surgery after the shooting. A federal grand jury in Grand Rapids, Mich., indicted Glen Porter and Travis Curry on charges of conspiring to commit armed robbery, attempted armed robbery, and brandishing and discharging firearms during the robbery attempt (WSBT2 June 19). Both could receive a maximum sentence of life in prison. Devarence Kimbrough, a third accused robber, was shot twice and died Jan. 18 in surgery. Curry allegedly waited in the car during the robbery, while Kimbrough and Porter entered the credit union with guns drawn, said U.S. Attorney Charles R. Gross. A shootout with a security guard wounded Porter in the buttocks. Kimbrough was shot twice in the chest and upper body, Gross said. Outside the credit union, the shootout continued with Kimbrough firing at the guard pursuing him. Curry allegedly picked up Porter and Kimbrough, then drove Kimbrough to a Hospital in South Bend, Ind., where he died. Berrien Teachers CU, based in St. Joseph, Mich., has $219 million in assets.

Maxwell Herring awards named by Florida league

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ORLANDO, Fla. (6/20/08)--Winners of Florida’s 2008 statewide competition for the Dora Maxwell Award for Social Responsibility, and the Louise Herring Award for Philosophy in action were recognized at the 74th Annual Florida Credit Union League Convention and Expo held in Orlando June 11-14. First-place Dora Maxwell Social Responsibility awards went to:
* Gold Coast FCU, West Palm Beach ($50 million to $100 million assets); * PBC CU, West Palm Beach ($100 million to $200 million); * Insight Financial CU, Orlando ($200 million to $500 million); and * Pen Air FCU, Pensacola ($500 million and above assets).
First-place Louise Herring Philosophy in Action Awards went to:
* Gold Coast FCU; and * FAIRWINDS CU, Orlando ($250 million or more assets).
Each of the first-place winners will advance to their national competitions where the Credit Union National Association will select the national award winners.

CU attendees told to develop ID theft prevention

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HOLLYWOOD, Fla. (6/20/08)--Credit unions should develop ID theft prevention measures based on their own ID theft situation, conference attendees were told Thursday at CUNA Mutual Group's Discovery Conference, meeting this week in Hollywood, Fla.
CUNA Mutual Risk Manager Ken Otsuka and National Association of State Credit Union Supervisors (NASCUS) Vice President Jenny Champagne discussed new identity theft "red flag" rules with Discovery Conference attendees Thursday. (Photo provided by CUNA Mutual Group)
Ken Otsuka, risk manager at CUNA Mutual, and Jenny Champagne, vice president of regulatory development and education at the National Association of State Credit Union Supervisors, outlined new identity theft "red flag" rules required by the Federal Trade Commission and other fed agencies by Nov. 1. They noted that proper implementation of sections 114 and 315 of the Fair and Accurate Credit Transactions Act of 2003 (FACT Act) will help protect credit unions and their members against identity theft. A successful ID theft prevention program will help credit unions mitigate reputation risk--a key aspect of examinations. “Regulators are also paying attention to due diligence, so a regular review of your ID theft program should include assessments of third-party service providers,” said Champagne. The FACT Act was signed into law in December of 2003. Its provisions giving consumers the right to receive a free credit report from the three major credit bureaus; requiring truncation of credit and debit card numbers on receipts; and providing ID theft victims the ability to place a fraud alert on their credit report. Section 114 requires credit unions to develop a written Identity Theft Prevention Program to detect, prevent, and mitigate identity theft related to new or existing covered accounts, Champagne said. “Covered accounts include business and consumer accounts such as credit cards, mortgage loans, automobile loans, margin accounts, cell phone accounts, utility accounts, checking accounts, and savings accounts,” she said. The prevention program must be approved by the credit union’s board and include policies and procedures that detect red flags and help answer the questions, "Who will be responsible for detecting red flags?" and "How will they detect the red flags?" Five categories of red flags include:
* Alerts, notifications, or warnings from a consumer reporting agency; * Suspicious documents; * Suspicious personal identifying information; * Unusual use of, or suspicious activity related to, the covered account; and * Notice from customers, victims of ID theft, law enforcement authorities, or other persons about possible ID theft connected to covered accounts.
Credit unions should be capable of responding appropriately to any red flags and should update their procedures periodically to reflect changes in risks from identity theft, Otsuka said. He cautioned there is not a one-size-fits-all solution. “The program must be tailored to the size of the credit union and the complexity of its operation. The credit union must also ensure oversight in the development, implementation and administration of the program, staff training and overseeing service provider arrangements.” Otsuka suggested forming a risk assessment team that would review all operational areas to identify the types of red flags that could surface in each area such as new accounts, loans or call centers. “A credit union should factor in its own experience with ID theft losses and consider credit union industry losses to the degree possible.” Staff training is critical. “It’s important for staff to first understand the various forms of identity theft, how they are perpetrated and the red flags that are raised within each type. If they understand the nature of the losses themselves, it will be easier for them to spot red flags,” he said.

Helber elected chairman of Florida league

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ORLANDO, Fla. (6/19/08)--Rich Helber, executive vice president and chief financial officer, GTE FCU, Tampa, has been elected the new chairman of the Florida Credit Union League’s (FCUL) board of directors. He was elected during FCUL’s 74th Annual Convention and Exposition. He succeeds John Hirabayashi, president/CEO, Community First CU of Florida, Jacksonville. Helber also is chairman of the Florida Credit Union Foundation and serves on the National Credit Union Foundation Finance and Audit Committees. He formerly held positions as president/CEO of Central Corporate CU and vice president of financial operations and services, U.S. Central CU, Lenexa, Kan. Also elected were the FCUL board’s executive officers:
* Chairman-Elect: Mary O. Wood, president/CEO, Florida West Coast CU, Brandon; * Treasurer: Brent E. Lister, president/CEO, First Florida CU, Jacksonville; * Secretary: Tom Randle, CEO, Sarasota (Fla.) Coastal CU; and * Executive Officer-at-Large: Anice Prosser, senior vice president, human resources, Envision CU, Tallahassee.

Hannaford breach judge sets meeting with lawyers

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PORTLAND, Maine (6/19/08)--A federal judge in Portland, Maine, has set a meeting July 10 with lawyers in the class-action data-breach lawsuits filed against grocery store chain Hannaford Bros. U.S. District Judge D. Brock Hornby will meet with attorneys before deciding which of two groups will be lead plaintiffs in the case (Business Digest June 18). About 23 lawsuits were filed in four states over the breach, which affected customers of more than 300 stores in New England and Florida. Those cases are being consolidated under the federal court's multi-district litigation program in the Maine court (News Now June 11). The lawsuits stem from a breach from Dec. 7, 2007, to March 10, which allowed hackers to steal the credit and debit card numbers of 4.2 million Hannaford customers while they swiped the cards for authorization of purchases at grocery stores. It was the first major breach of a system that was compliant with industry standards. Credit union members were among those whose cards were compromised. In Maine, about 68 credit unions reissued more than 100,000 credit and debit cards to try to limit the amount of fraud (News Now March 24).

N. Carolina league announces award recipients

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GREENSBORO, N.C. (6/19/08)--The North Carolina Credit Union League recognized credit unions and credit union professionals with several awards during the league’s 73rd annual meeting, held June 8-11 in Pinehurst, N.C. Two individuals received the Mark of Excellence Award:
* Patty Idol, president/CEO, Mountain CU, Waynesville; and * Clyde Padgett, volunteer, Truliant FCU, Winston-Salem.
The Mark of Excellence Award, one of the highest honors that can be presented to credit union people in North Carolina, recognizes sustained leadership. Eligibility is limited to Ronald J. Hutchins Credit Union Person of the Year Award recipients with 25-or-more years of credit union experience. Two individuals received the Ronald J. Hutchins Credit Union Person of the Year Award:
* Career Person of the Year: Maurice Smith, president/CEO, Local Government FCU, Raleigh; and * Volunteer Person of the Year: John Herrera, chairman, Latino Community CU, Durham.
The Ronald J. Hutchins Credit Union Person of the Year Award is one of the highest honors members of the credit union profession can receive. The award is given each year to an individual in recognition of his/her outstanding accomplishments, time and effort given in support and promotion of the credit union ideal. Receiving the Louise Herring Philosophy in Action Award was Local Government FCU, Smith, president/CEO (over $250 million asset category). Receiving first place in the Desjardins Youth Financial Education Award were:
* State Employees' CU, Raleigh--Jim Blaine, president/CEO (over $250 million asset category); and * Winston-Salem City Employees' CU, Winston-Salem--Tony Ebron, president/CEO ($35 to $75 million asset category).
First place Maxwell Social Responsibility Awards went to:
* State Employees' CU, Raleigh--(over $500 million asset category); * Fort Bragg FCU, Fayetteville--David Elliott, president/CEO ($200 million to $500 million assets); * Members CU, Winston-Salem--Jack Braswell, president/CEO ($100 million to $200 million assets); * Telco Community CU, Asheville--Rita Gentry, president/CEO ($50 million to $100 million assets); * Greensboro Municipal CU, Greensboro--Judy Hurt, interim president/CEO ($20 million to $50 million assets); and * Choice Community CU, Greensboro--Martha Miller, president/CEO ($20 million to $50 million assets).

Largest CUs power outage affects thousands

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VIENNA, Va. (6/19/08)--A power outage at the headquarters of Navy FCU in Vienna, Va., temporarily cut access to the credit union’s website and phone system Tuesday. The website and phone systems were restored Tuesday evening. No financial data was lost in the outage, Jennifer Sadler, Navy Federal public relations manager, told News Now. On Monday night, a storm in Virginia caused Navy Federal to lose power. Generators kicked in, but the credit union’s data center was shut down. The credit union received e-mails and inquiries in its branches from members who couldn’t access the website or make online transactions. Members could still conduct business by visiting their local Navy Federal branch, Sadler said. Navy Federal has $33 billion in assets and three million members.

CIF investors will be featured in ad campaign

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WASHINGTON (6/19/08)--Starting next month, the National Credit Union Foundation (NCUF) will premiere a series of advertisements intended to build awareness of how the Community Investment Fund (CIF) supports programs and grants that impact people’s lives. The first ad will feature Harriet May, CEO, GECU, El Paso, Texas. May received the 2008 Herb Wegner Memorial Award. Her ad will debut in the July issue of Credit Union Magazine and the July 1 issue of America’s Credit Union Conference Daily. Each ad will feature photos and quotes to show the connection between credit union leaders supporting CIF and their communities.

CUNA Mutual offers 60-day grace period for flood victims

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MADISON, Wis. (6/19/08)--CUNA Mutual Group has placed 60-day moratoriums on company-initiated cancellations and non-renewals of any in-force insurance policies for policyholders in four states hardest hit by June floods--Illinois, Indiana, Iowa and Wisconsin. The company announced it also is waiving any penalties for late-premium payments for policyholders in these states for the same period. The actions were effective as of Wednesday. Other states that experience widespread and damaging floods may be added in the future. “Flood waters have been at historic levels this month, and thousands of individuals and businesses have been severely impacted,” said CUNA Mutual President/CEO Jeff Post. “Taking steps to help policyholders affected by the flooding is good business.” CUNA Mutual’s moratoriums cover policyholders throughout the four states and are not restricted to counties declared disaster areas. The moratoriums are only for nonpayment of premium for in-force policies. New policies will be required to pay premium at inception, or as otherwise required. The moratoriums apply only to policies underwritten by CUNA Mutual.

CEO Give CUs credit as payday lending solution

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DALLAS (6/19/08)--It’s time to give credit unions the credit they deserve as payday loan solutions, wrote Rita L. Haynes, CEO, Faith Community United CU, in an opinion piece published Monday in The Dallas Morning News. Last week, legislators approved legislation to limit the predatory practices of payday lenders in Ohio. Payday lenders argue that the poor won’t have anywhere else to obtain short-term loans, Haynes said. However, credit unions are a healthy alternative to payday lending, she wrote. Those with community development financial institution status, like Faith Community, can provide the low-wealth individuals with short-term loans. Credit unions are prudent, but do take measured risks to help those in need, Haynes added. “We teach someone how to plan and save and become a good credit risk,” she wrote. “We provide financial education and personalized advice.” Haynes’ credit union recently created a “Grace Loan” program, which provides short-term loans that banks normally do not provide. “We require that the borrowers save a portion of what they would have given to the payday lender in fees, thus teaching them good financial habits and helping build a credit history for their goals,” she wrote.

Pa. Supreme Court quashes banks tax claims

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HARRISBURG, Pa. (6/19/08)--In a unanimous decision, the Pennsylvania Supreme Court ruled Monday that the Pennsylvania Bankers’ Association and other banker plaintiffs are not entitled to appeal a lower court’s dismissal of several claims against two credit unions and the Pennsylvania Department of Banking. The two credit unions are Trumark Financial CU, based in Trevose, and Freedom CU, Warminster. The Pennsylvania Credit Union Association (PCUA) had intervened on behalf of the credit unions. “The Supreme Court’s ruling this week is a positive development for the credit union defendants because it confines the case to the remaining claims in the Commonwealth Court," said PCUA General Counsel Rick Wargo. Credit Union National Association (CUNA) General Counsel Eric Richard agreed, adding, “We thought all along this banker appeal was questionable, and the court has agreed.” The Pennsylvania Supreme Court agreed with the credit union defendants and ruled that the earlier order from the lower court was not final and thus, not appropriate for the banker appeal. In essence, because several of the claims have not been resolved, the lower court’s opinion did not decide the case, “but merely narrowed the scope of the banks broader” claims, the court said. In January 2005, the banker groups brought suit in the Pennsylvania Commonwealth Court to overturn the state banking department’s decision to permit the two credit unions to convert to community charters. The banks also challenged their dismissal by the banking department from the regulatory proceedings. In the Commonwealth Court, the bankers raised other claims, including the claim that the credit union tax exemption violated Pennsylvania and U.S. constitutions. The lower court dismissed several of the constitutional tax issue claims, and it was the dismissal of those claims that the bankers sought to appeal to the Pennsylvania Supreme Court. However, one tax challenge remains pending in the Commonwealth Court. The claims regarding the field of membership changes have been argued in the Supreme Court, and the credit unions are awaiting an opinion from the Court on those claims. It is unclear when the remaining issues will be decided. In its decision, the Supreme Court concluded, “at this juncture we still have no idea if the Commonwealth Court will ultimately enter a judgment for or against the banks."

California Nevada CUs grew in 07

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RANCHO CUCAMONGA, Calif. (6/19/08)--Despite challenges from the economy, credit unions in California and Nevada experienced areas of growth in 2007, according to a new report. The California and Nevada Credit Union Leagues recently released the 2008 WestScan economic activity report for credit unions in Nevada and California. Among the economic trends projected to affect credit unions in the states:
* Credit union loan growth showed impressive resiliency with 6.54% growth in 2007, slightly off 2006’s growth of 7.83%. Despite the lagging real estate market, first mortgage loans grew $5.3 billion in the fourth quarter, with 2007 loans of more than $20 billion, a 15.21% jump; * Return on average assets (ROA) was down 0.18 percentage points to 0.65% at year-end 2007 from 2006’s ROA of 0.83%. Credit unions nationwide also watched their net interest margin slip slightly, to 3.12% in 2007 from 3.17% in 2006; and * A modest 1.67 percentage point increase over 2006’s 84.03% in deposits indicates that while loan dollars continue to grow, credit unions currently should have sufficient deposit dollars to meet liquidity needs.
In California, gross income to average assets grew in 2007 to 6.98%, from 6.49% in 2006, according to the report. Assets for California credit unions grew by 3.93% in 2007--down a 0.57 percentage point from the previous year reading of 4.50%. Membership growth accelerated to 1.64% in 2007 from 1.04% in 2006, its highest increase since 2004. Mortgage lending grew at 13.03% and other real estate lending at 8.87%. In Nevada, first mortgage lending grew at 13.34%, credit cards grew at 27.39%, and unsecured lending grew at 24.32%. Membership growth accelerated to 0.30% in 2007 from 0.14% in 2006. Although down 3.55 percentage points from 2006’s 4.14% gain, assets still grew 0.59. WestScan is an annual financial report--with quarterly updates--that examines economic, financial, demographic, and other trends affecting credit unions in the two states.

CU movement responds to Midwest disasters

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MADISON, Wis. (6/18/08)--Credit unions are coming through for Iowa and other Midwestern credit unions caught in last week's flooding, but it is too early to gauge what will be needed. The Iowa Credit Union Foundation (ICUF) has opened an appeal for donations to a disaster grant fund, Marybeth Foster, ICUF executive director, told News Now. Credit unions in Iowa are being provided with applications to the fund. The grants are $500 each and go toward emergency needs. ICUF has received 20 applications for aid in two days and expects more. The floodwaters in Iowa haven't gone down enough for everyone to assess damage, Foster added. The National Credit Union Foundation (NCUF) also has opened up an appeal for donations to CU Aid, the national online relief center for credit unions, and people can donate through an online application, Foster added. The Texas Credit Union Foundation (TCUF) board of trustees approved a $5,000 grant to go toward disaster relief for credit union employees in the affected areas of Iowa, according to LoneStar Leaguer June 17). “What is happening in the Midwest is tragic,” said Jill Pharr, TCUF executive director. “As families and communities struggle to get through this difficult time and begin the process of rebuilding, they can take comfort in the fact that credit unions from across the country, the people who serve them and the members who believe in the cooperative structure of the movement, have compassionately responded with aid and support,” Pharr added. More than 20 credit unions in Iowa were forced to close because of the floods, especially in hard-hit Cedar Rapids, Cedar Falls, Des Moines and Waterloo areas. Other credit unions offered assistance. Metco CU, Cedar Rapids, Iowa, was evacuated June 11 because of flooding. The credit union set up a temporary location on Thursday and was able to re-open Friday, Brad Mertens, Metco CU CEO told News Now. "We were only shut down for a day," he said. Metco is sharing space with Quaker Oats CU, Cedar Rapids. He said the credit union's disaster preparedness plan to share space with the credit union was successful. "You hope you never have to use those plans, but it's worked well so far." The credit union will likely offer "no questions asked" emergency loans up to $500 with low interest rates, he said. Metco is still assessing its damage--nobody has been able to get to the credit union since the evacuation because the area around it is flooded. Metco members, like many Iowans, are struggling, Mertens said. "It's pretty devastating," he said. "This event touched a lot of people." Metco is chartered to serve city and county employees. Their offices have been affected by the floods, leaving many members out of work, he added. Marine CU, Fond du Lac, Wis., has made $1 million of 0% interest loans for victims of flooding in Wisconsin, Minnesota and Iowa (The Fond du Lac Reporter June 17). The money aims to cover costs of cleanup, temporary housing or other needs. The money will be distributed on a first-come, first-served basis and is limited to $5,000 per borrower. The loans are interest- and payment-free for the first 120 days, the newspaper said. Even credit unions not directly affected by flooding are indirectly impacted. Energy Plus CU, based in Indianapolis, has three branches--one of them in Reedsburg, Ind. It experienced power outages, and its employees needed time off to deal with water and power outages. "One woman had no power for four days," said Cari Palmer, marketing coordinator. She added that washed out roads created difficulties for employees, whose commutes were tripled in time. Energy Plus CU is offering members storm damage loans of up to $2,500 with 7.25% interest for 12 months. "We announced it Tuesday morning and sent out e-mails, posted flyers, and sent information through inter-company mail for our employee groups," Palmer told News Now. "We're waiting for responses. They will need it for their deductibles," she said.

Indiana FIs investigating overseas withdrawals

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SOUTH BEND, Ind. (6/18/08)--South Bend, Ind., credit unions were among area financial institutions whose accountholders were targeted by fraudulent overseas withdrawals on debit cards. Cards for about 150 members of Teachers CU, a $1.856 billion asset credit union, were among those compromised, according to Paul Marsh, senior vice president of sales and marketing. Some members experienced funds withdrawn from their accounts, The average amount withdrawn was less than $200, he told News Now. The withdrawal transactions were all based on personal identification numbers made on debit cards at ATMs in Russia, the Ukraine and Nigeria. The transactions were over 10 days. "It was a very localized attack against a number of financial institutions, both credit unions and banks," Marsh said. "There was no breach of our information or our systems," he said. The credit union found out about the fraud Monday morning and immediately took proactive measures. "We called each member and proactively reviewed all the logging activities for the accounts," Marsh said. The credit union shut down the compromised accounts and reopened new ones. "We're meeting with the individuals to go over their circumstances. We're providing member services, refunding fees and crediting the unauthorized charges on a case by case basis," Marsh said. "We also are making recommendations about what they should do and what they'll need to keep their finances safe and secure." One woman told police that $106 had been withdrawn from an account and a man reported that $1,300 has been withdrawn from his account, according to Associated Press via South Bend Tribune (June 16). Both transactions took place in Novosivirsk, Russia, the paper said. At least one other credit union in South Bend reported that 10 of its members were affected by the scam.

Carl Stewart named RMJ Foundation board chair

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RANCHO CUCAMONGA, Calif. (6/18/08)--The Richard Myles Johnson (RMJ) Foundation, the state foundation for credit unions in California and Nevada, has named Carl Stewart, CEO of Water and Power Community CU in Los Angeles, as its new board chairman. Mike Gomez, CEO, Fiscal CU, Glendale, Calif.; and Sheri Ledbetter, vice president of corporate affairs, Western Corporate FCU, San Dimas, Calif., were named vice chairman and secretary, respectively. Immediate Past Chairman Debra Grisamer, CEO, Alta Vista CU, San Bernardino, Calif., has served on the board for more than 11 years and as chairman since 2004. She will remain on the board until her term expires at the end of the year. Stewart and Gomez have served on the RMJ Foundation board since 2002. Ledbetter was elected in 2006. “Financial education is vital to the future of the credit union movement, and our goal in this coming year is to continue to support quality youth financial literacy programs throughout California and Nevada,” Stewart said. The incumbent board members are:
* Marie Alonzo, chairman, Arrowhead CU, San Bernardino, Calif; * Sarah Canepa Bang, CEO, Financial Service Centers Cooperative, San Dimas, Calif.; * Bill Cheney, California and Nevada Credit Union Leagues president/ CEO; * Tony Boutelle, CEO, Credit Union Direct Lending, Rancho Cucamonga, Calif.; * Mary Cunningham, CEO, USA FCU, San Diego; * Kim Hester, executive vice president, network services, CO-OP Financial Services, Rancho Cucamonga; * Foundation namesake Richard M. Johnson; and * Jim Updike, CEO, Honda FCU, Torrance, Calif.
Marv Jensen, board member, Episcopal Community FCU, Los Angeles, serves as board member emeritus.

Williams wins CaliforniaNevada youth involvement award

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RANCHO CUCAMONGA, Calif. (6/18/08)--Jeff Williams, member education director at Educational Employees CU (EECU), Fresno, Calif., has received the 2008 California and Nevada Youth Involvement (CNYIN) Award. The award means Williams will attend the National Youth Involvement Board's (NYIB) annual conference, to be held July 28-31 in Las Vegas, Nev. Williams was honored for his financial literacy efforts in his community. CNYIN Board Chairman Marissa Lott, marketing specialist with Farmers Insurance Group FCU, Los Angeles, noted that Williams has conducted 111 classroom presentations to 5,644 students from July 2007 to May 2008. He also conducted four breakout sessions for students from 10 high schools at a Fresno Chamber of Commerce Business and Education Career Fair. His primary focus is education of members and the community in the 10 counties EECU serves. He also worked with the marketing team to start four new youth programs, for members ranging from 0 to 24 years old. This year's NYIB conference is co-sponsored by the California and Nevada Credit Union Leagues. For more information contact Catherine Arra at 800-472-1702, ext. 3486 or at catherinea@ccul.org.

Kaiperm FCU Alliant CU in merger negotiations

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OAKLAND, Calif. (6/18/08)--Kaiperm FCU, Oakland, Calif., is negotiating a merger with Alliant CU, Chicago. Kaiperm has posted a letter on its website with information about the merger. The two credit unions will work together to make the merger seamless for its members, Shirley L. Jones, chairman of Kaiperm’s board, said in the letter. Kaiperm decided to pursue the merger after research it conducted determined a merger was the best way to improve and enhance financial services for its members. During the first three months of this year, the credit union posted losses of $2.2 million (InsideBayArea.com June 17). Alliant has $5.5 billion in assets and 200,000 members nationwide. Kaiperm has $94 million in assets and 17,536 members.

CU System briefs (06/17/2008)

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* NORTHVILLE TOWNSHIP, Mich. (6/18/08)--Michigan Credit Union League has added three new staff to its governmental affairs team: Marcia Hagenbarth, David Mroz and Jamie Wolfe. Hagenbarth is legislative affairs director, succeeding Andrew Doerr. She will oversee the league's legislative, grassroots advocacy and political action programs. She has more than nine years' experience in Lansing, most recently as assistant director of government affairs for SEIU Healthcare. David Mroz is the new political affairs coordinator, succeeding Nancy Short. He will direct the league's political fundraising, grassroots advocacy and campaign-related programs. Mroz formerly was Michigan political/field director for the Mitt Romney for President campaign. Wolfe is governmental affairs support specialist, succeeding Angie Hall. She previously was an administrative assistant with Aerostek Staffing. Wolfe has three years' experience as an administrative assistant in the Michigan House of Representatives … * GREAT FALLS, Mont. (6/18/08)--Electric City FCU (ECFCU) is merging with 1st Liberty FCU, Great Falls, Mont., to better serve ECFCU’s members. ECFCU’s members will have access to electronic bill pay, Internet banking and other services. (Great Falls Tribune June 12). ECFCU has $900,000 in assets. 1st Liberty has $113 million in assets ... * TULSA, Okla. (6/18/08)--Mayes County FCU, Pryor, Okla., is merging with Red Crown FCU, Tulsa. The merger will be complete at the end of the year. Red Crown will take over Pryor officially July 1. Mayes County FCU will be renamed Red Crown FCU, Mayes County Branch (Tulsa World June 17). Mayes County FCU has $21 million in assets. Red Crown has $81.5 million in assets ... * BIRMINGHAM, Ala. (6/18/08)--The board of directors at Jefferson County Teachers’ CU, Birmingham, Ala., announced it will change the credit union’s name to eCO CU, effective July 1. The name change allows the credit union to appeal to a more diverse membership. “We took the ‘e’ from Educators and ‘CO’ from Community,” said eCO CEO Joey Hand. eCO has $88 million in assets ...

New Mexico CUs elect league board

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ALBUQUERQUE, N.M. (6/18/08)--During the Credit Union Association of New Mexico’s annual meeting on June 6, the board of directors re-elected several officials. They are:
* Chairman: William Jacobs, CEO, White Sands FCU, Las Cruces; * Vice chairman: Scott Connely, CEO, Sandia Area FCU, Albuquerque; * Secretary: Karen Griffo, CEO of Roswell (N.M.) Community FCU; and * Treasurer: Harold Dixon, CEO, State Employees CU, Sante Fe.
Ronnie Johnston, CEO, Artesia (N.M.) CU, will fulfill a term vacated in District 2, and Judy Carrasco, CEO, Financial Security CU, Carlsbad, will replace him as alternate. Donald Sarich, CEO, Permaculture CU, Sante Fe, also was chosen as an alternate director for District 6. Remaining on the board are:
* Chuck Valenti, CEO, Del Norte CU, Los Alamos; * Larry Lujan, CEO, Northern New Mexico School Employees FCU, Sante Fe; * Andi Baum, CEO, Everyone’s FCU, Tucumcari; * Gary Sterton, CEO, Animas CU, Farmington; * Chris Fitzgerald, CEO, Rio Grande CU, Albuquerque; and * Robert Chavez, executive vice president and chief operating officer, Sandia Laboratory FCU, Albuquerque.

Latino conference tackles foreclosure service

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DALLAS (6/18/08)--Credit unions should do everything they can to help educate consumers about the services available to keep them in their homes, U.S. Treasurer Anna Maria Escobedo Cabral told attendees of the Fifth Latino Credit Union Conference in Dallas last week. Cabral opened the conference with a discussion about the foreclosure crisis in the U.S. She applauded credit unions for their efforts to provide financial education and affordable financial services to low- and moderate-income Americans.
From left: Harriet May, CEO, GECU, El Paso, Texas; Dick Ensweiler, CEO, Texas Credit Union League; Maria Martinez, CEO, Border FCU, Del Rio, Texas; and John Herrera, vice president for advocacy, Self-Help CU, Durham, N.C., and founder of Latino Community CU, Durham; spoke at the Fifth Latino Credit Union Conference in Dallas last week. (Photo provided by the National Federation of Community Development Credit Unions)
Credit unions also can serve new Americans, including those whose immigration status is in question, said Bill Cheney, CEO of the California and Nevada Credit Union Leagues. “We have in California a number of credit unions who have been extremely successful in accepting the Matricula Consular (consular identification) for new members and existing members,” he said. Immigration status of those carrying the consular identification is sometimes controversial, but “credit unions are not immigration attorneys, nor a police force, and once the credit union’s board of directors has determined what the credit union’s field of membership is, it becomes the credit union’s responsibility to serve the entire field of membership,” he added. Matricula Consular “is a perfectly legal and acceptable form of identification,” and the National Credit Union Administration has published briefs and papers about the legality of credit unions to accept the identification, Cheney said. Credit unions have a great opportunity to serve the Latino market, said Dick Ensweiler, former Credit Union National Association (CUNA) board chairman and president/CEO of the Texas Credit Union League (TCUL). It’s important to identify major defining factors of Latino groups within each specific community so credit unions can design programs and services tailored to the needs of their membership, he said. Attracting Latinos requires not only an understanding of Latino language and culture, but knowledge of the types of services they need. Credit unions should start with basic services such as remittances, check cashing, debit and ATM cards, basic savings and checking accounts, he added. “People ask me for my business plan to serve Hispanics, and I tell them we serve Hispanics because that’s our community,” concluded Harriet May, president/CEO of GECU, El Paso, Texas, and a CUNA board member. “Our credit union membership is 80% Hispanics. This is something we do because it’s our culture, because it’s the right thing to do, and because it’s simply good business.” The four-day conference was organized by the National Federation of Community Development Credit Unions and the Network of Latino Credit Unions and Professionals. Sponsors included the TCUL, CUNA Mutual, NeighborWorks America, UNFCU Financial Advisors, the California and Nevada Credit Union Leagues, Southwest Corporate FCU, SLI Group and Coopera Consulting.

Fitch announces ratings for Southwest Corporate

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NEW YORK and PLANO, Texas (6/17/08)--In what is becoming a trend reflecting today's economic market, Fitch Ratings has reaffirmed the ratings of yet another corporate and added a Negative Watch component. Fitch maintained the ratings of Southwest Corporate FCU but placed them under a Negative Watch. The ratings are:
* Long-term Issuer Default Rating (IDR): AA-; * Short-term IDR: F1* * Short-term debt: F1+; * Individual A/B.
In its press release, Fitch said it "recognizes Southwest's ample liquidity, low reliance on borrowings, robust risk management practices and solid franchise. Southwest has the intention, and importantly, the ability to hold its investment securities until recovery or maturity." Fitch also noted that "Southwest's earnings performance compares well with other corporate credit unions." The ratings agency also said it placed the corporate's ratings on a Negative Watch primarily because it was concerned about an increasing possibility that the corporate could realize investment losses related to the deterioriating collateral performance of mortgage-backed securities. "I think that it is important to note that Fitch is citing a possibility but not a probability of losses," said John Cassidy, president/CEO of the Plano, Texas-based Southwest Corporate. "Southwest Corporate management is also very mindful of the possibility of experiencing losses related to our residential mortgage-backed security portfolio, but we remain confident that there is a low probability that we will realize meaningful investment losses," he said. The corporate's staff perform "rigorous investment credit analysis," including "multiple loss scenario projections on a bond by bond basis, supplemented by ongoing external validations performed by third-party experts," Cassidy added. "Fitch cited the level of our investment credit analysis when commenting on the close monitoring of mortgage collateral performance by our staff." Cassidy reiterated several points made in Southwest Corporate's 2007 Annual Report:
* As with any supply-and-demand market, the lack of trading activity in mortgage-backed securities caused the corporate's recorded asset fair values to decline; * Despite that decline, Southwest's investments are comprised of high quality assets; * The corporate expects the asset fair values to recover, over time, when more typical trading levels resume; and * The corporate's operating results have never been stronger and it has ample sources of liquidity to prevent the need to sell securities during the current market dislocation.

MarylandDC league elects officers presents awards

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OCEAN CITY, Md. (6/17/08)--More than 600 credit union staff, volunteers and business partner representatives gathered at the Maryland and District of Columbia Credit Union Association’s (MDDCCUA) third annual meeting and convention recently where they listened to speakers, elected officers and presented awards. At the meeting, Michelle Singletary, nationally syndicated columnist for The Washington Post suggested several opportunities for credit unions to help people build wealth (Focus Newsletter June 16). Among them: market the credit union’s presence, form alliances with community agencies and groups, hold seminars, provide a remittance service, establish an Internal Revenue Service volunteer income tax assistance program, fill the banking gap with specialized services, and offer a second-chance checking account. Dennis Dollar, former National Credit Union Administration chairman and president of Dollar and Associates, predicted that credit unions will be the dominant community financial institutions, share branching will be a key credit union differentiator, and credit unions will retain their federal tax exemption. Awards presented at the meeting included:
* The Hall of Fame Congressman Wright Patman Memorial Award--the MDDCCUA’s top award--was presented to J. Wesley Bone, MDDCCUA chairman and board member of First Financial of Maryland FCU, Lutherville. Bone concluded 37 years of service as the credit union’s chairman of the board. Patman was a co-sponsor of the original Federal Credit Union Act. * The 2008 Volunteer of the Year--the Janet C. Glomp Memorial Award--went to Richard Reinhardt, director emeritus, Destinations CU, Baltimore; and * The 2008 Professional of the Year--Judith A. Burgin Memorial Award--went to Cindy Prestandrea, president/CEO, Prince Georges Community FCU, Upper Marlboro.
The election results for the four at-large seats on the MDDCCUA Board of Directors were announced by a VoteNet representative at MDDCCUA’s third annual business Meeting held on June 14 at the Clarion Fontainebleau Hotel in Ocean City, Md. The following incumbents won the election, each with three-year terms:
* Miguel Boluda, Jr., CEO, PAHO-WHO FCU, Washington, D.C.; * Chris Conway,CEO, Educational Systems FCU, Greenbelt; * Charles Mallon, CEO, Congressional FCU, Washington, D.C.; * Rod Staatz, CEO, State Employees’ CU, Linthicum.

CU System briefs (06/16/2008)

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* LINCOLN, Neb. (6/17/08)--First Lincoln FCU has reported that counterfeit cashier's checks bearing its name are in circulation. The counterfeit items display the credit union's routing number, but the telephone number 1-888-214-2033 displayed is not accurate, according to the Federal Deposit Insurance Corp. They also have scrolled top and side borders and a patterned light blue hexagonal background, with the embossed numeric dollar amount printed in red. The back of the fake checks is white with blue lines and says, "This check is void without a patterned background on front." Authentic checks are light green with blue print, have red check numbers, have perforated top and bottom edges, and carry a warning on back that the back of the document is blue and has LineMark lines that change from dark to light in reflected light … * DECATUR, Ala. (6/16/08)--Family Security CU (FSCU), Decatur, Ala., received several phone calls Friday from individuals from California, Texas and Illinois concerning FSCU cashier's checks attached to lottery letters. All of the checks are counterfeit. "They have our name and address, but these checks are not in the correct format and have the wrong authorized signature at the bottom," Gina Turney, FSCU director of compliance and security, told News Now. FSCU expects more individuals to call about the checks within the next few days, Turney added … * TULSA, Okla. (6/17/08)--Tulsa Teachers CU was the target of massive three-pronged phish attempts earlier this month, according to a Tulsa Better Business Bureau alert (Tulsa World June 12). The attack, which originated in Davidson, N.C., involved e-mail phishing, text-messaging to cell phones and vishing or telephone calls, all asking for personal information. The attacks affected less than 20 credit union members. A few provided the information, and the credit union has closed their accounts and reopened new ones … * EDGEWATER, Md. (6/17/08)--Maryland and District of Columbia Credit Union Association staff and credit union officials met with congressional candidates recently at Aberdeen Proving Ground FCU's Operations Center. The candidates--State Sen. Andrew Harris, M.D., (R) and state attorney Frank Kratovil (D)--are running for the seat of Rep. Wayne Gilchrest (R-Md.). They answered questions from representatives of nine credit unions in the Dist. 1. The meeting is part of a process to determine who receives MDDCCUA's "Friend of Credit Union" status (Focus Newsletter June 16) … * RALEIGH, N.C. (6/17/08)--Coastal FCU in Raleigh is offering Interest on Lawyer's Trust Accounts (IOLTAs), a general trust account that bears dividends for attorneys and law firms that handle money on behalf of their clients. The $2.02 billion asset credit union said its IOLTA has no minimum balance requirements, has no monthly maintenance fees, and allows for unlimited monthly deposits and withdrawals. North Carolina law, effective June 30, requires that all attorneys holding money in trust for their clients must use an IOLTA. Coastal is participating to help attorneys comply with the law and to provide a public service … * PALO ALTO, Calif.(6/17/08)--Addison Café is the new online branch aimed at Generation Y members of the Addison Avenue FCU, a $2.064 billion asset credit union in Palo Alto, Calif. Members can apply for share draft accounts, auto and student loans, mortgages, and credit cards or participate in the site's blog …

Regulators from four states meet with NASCUS

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CHICAGO (6/17/08)--“It’s important to bolster regulator-to-regulator communication to ensure regulators are taking appropriate actions to help credit unions mitigate their risks and maintain operations in a safe and sound manner,” National Association of State Credit Union Supervisors (NASCUS) Chairman George Reynolds told state regulators at a meeting last week. Reynolds, senior deputy commissioner of the Georgia State Department of Banking and Finance, met with regulators from Illinois, Kansas, Michigan and Wisconsin June 11 to discuss legislative issues affecting state agencies. The Illinois Department of Financial Institutions co-hosted the meeting at its agency offices. The meeting covered credit quality, compliance and governance issues, unrelated business income tax (UBIT), proposed regulations, examiner training and national housing legislation. Ongoing training for credit union directors also was emphasized by regulators. NASCUS has held its annual regulator meeting series for four years. Regulators also met in Boston and San Francisco this year. The series will finish in Nashville, Tenn., Sept. 10. The regulators also plan to meet at the NASCUS State System Summit in Seattle Aug. 21.

Iowa CUs describe ordeal

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MADISON, Wis. (6/17/08)--Credit unions in Iowa began the cleanup process to assess damages from last week's floods that put several cities under water. However, many still aren't allowed back in the buildings and the true damage hasn't surfaced yet. "We're still monitoring the situation," said Phil Tschudy, media relations manager for CUNA Mutual Group. "Due to the heavy evacuation in many cities, particularly in Iowa, the extent of those damages will not be known until the credit unions are allowed back to their buildings." Because flooding is covered by federal insurance, CUNA Mutual may not be notified of losses due directly to flooding," he told News Now. News Now contacted a number of affected credit unions in Iowa. Des Moines (Iowa) Metro CU, relocated its operations to First Class CU in West Des Moines Tuesday night, but is moving back its original location and should be back to normal operations by noon today, Brent Helin, Metro CU CEO, told News Now. “We are about 250 yards from the Des Moines River and it was at high flood level--where it was at in 1993. They were forecasting a higher crest this time, so we relocated before any potential flooding arose,” Helin said. “However, we’re fortunate that the river level has come down, and we’ve started to relocate back to our offices. We didn’t really have any [flooding] issues.” Des Moines Metro was in the process Monday of moving data processing and vital records back to the credit union, Helin said. “We’re just going to keep our fingers crossed,” he added. Cedar Falls (Iowa) Community CU closed last Tuesday on orders from the city and relocated to another branch in the area, but then reopened Friday, said Helen Pearce, executive vice president of the credit union. “We had a little water in the basement, but we put in a plug and now we are fine,” she said. “We relocated to another branch in town and put a message on our website. Our business continuity plan worked.” In the downtown area, people in the community came to sandbag and saved two downtown levees. However, one levee sustained a breakthrough and there was flooding, she said. “A lot of our members did not have flood insurance,”’ Pearce said. “Some had flood insurance on their homes but not on the contents. A lot of homes are gone. Many members are waiting to see what FEMA does. In many places, members have to wait for inspectors to arrive and inspect the damage. “Material items can be replaced but sentimental items such as pictures and crafts made by children cannot,” she concluded. Collins Community CU, Cedar Rapids, has six out of seven branches operating, said Rick Benhart, credit union president/CEO. “One branch has a basement full of water, no power and it is not operating,” he said. Of the credit union’s 180 employees, about eight to 10 are experiencing a loss of their homes. “We’re trying to help them and using different loan programs to help people directly affected by the 100-year and 500-year flood plains,” Benhart said. “I have an extremely dedicated staff, and they are working extremely hard,” he added. “One branch has telecommunications out, and the staff is using cell phones. I’m very proud of all our staff. They are dealing with the emotions of members coming in and talking to them about the floods. So far, so good. We are seeing lot of credit unions helping other credit unions.” The flood waters in Cedar Rapids are receding, but city officials are keeping people out because of fears that power poles might not stay up because the ground is not solidified yet. Officials also are worried about contamination and other concerns, Benhart said. In Iowa City, the University of Iowa Community CU's Student Memorial Union branch, closed on Friday due to flooding on campus, according to CEO Jeff Disterhoft. "There is three feet of water in the branch, and there may be more. We don't know because no one is allowed in or out," Disterhoft told News Now. The student union branch manager, Jennifer Broich, has been reassigned to the credit union's Iowa Avenue branch. So far, three employees have material challenges with flooding of their homes but there may be more, he said. "We're giving them as much latitude as possible to take care of things they need to do, such as water and power outages. Many have more than a casual amount of water in their homes," Disterhoft said. The credit union's board and staff will meet this afternoon to brainstorm ways the credit union can assist and determine who to partner with in the relief efforts and how the credit union will do so. "We feel fortunate. Cedar Rapids and Cedar Falls have people in much more need. We're doing our best to determine who to partner up with to help," he said. In Waterloo, Iowa, Midwest Utilities CU's disaster plan was to move the credit union to Mid-American Energy, the business that it serves. But although the energy plant wasn't under water, everything else around it was, cutting off access, said Robert Hill, Midwest Utilities CEO. So, the credit union moved its operation to Hill's house. "We were only there for two days," Hill explained. "We reopened the credit union on Friday." Running the credit union's operation from Hill's home was a challenge because of Internet connections and software, but Midwest was able to serve its members. To let members know the credit union was closed, Hill put a sign on the credit union's door, and contacted the local newspaper and news stations about the closing. Iowa Community CU, Waterloo, closed its Waterloo branch last week and reopened it Monday, Mark Heth, Iowa Community CU CEO, told News Now. The Cedar Rapids branch also was closed and was relocated to Collins Community CU in Cedar Rapids. The credit union plans to offer disaster loan assistance to members, Heth added.

Variable pay programs more popular at CUs--Salary survey

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MADISON, Wis. (6/17/08)--More credit unions are looking to variable pay programs to increase compensation without increasing base pay, as wage increases remain flat across the nation due to the economic downturn, says a new Credit Union National Association (CUNA) report. Variable pay programs--which tie monetary rewards to performance measures and productivity--help credit unions keep salary expenses aligned with bottom-line results.
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Although variable pay programs increased overall, bonuses remained the most common way to boost compensation, according to the 2008-2009 Complete Credit Union Staff Salary Survey, published by CUNA’s center for research and advice. Among credit unions with $1 million in assets or more, 62% offered bonus payments--rewards not tied to preset performance criteria--and 42% offered incentive payments--rewards tied to preset performance criteria--to their employees. Management and nonmanagement employees were equally likely to be eligible for incentive payments, while management employees were more likely than nonmanagement employees to be eligible for bonus payments. A little more than one-third of survey respondents reported that management and nonmanagement employees were eligible for incentive payments in 2007, while 59% of management and 48% of nonmanagement employees were eligible for bonuses. The percentage of credit unions offering bonuses to nonmanagement employees increased from 42% the previous year. “The current economy and lack of wage growth are causing employees to experience higher financial stress than in the past,” said Beth Soltis, senior research analyst for CUNA’s center for research and advice. “In addition to incentive pay, credit unions may also want to consider adopting some non-monetary methods to compensate and inspire employees, like sabbatical days, development opportunities and flexible working arrangements. The survey provides compensation data for 89 full-time and eight part-time positions at credit unions with $1 million or more in assets. The data include: base salaries, incentives, bonuses, total cash compensation, and salary ranges. The report--available in print or Adobe PDF format--also contains job descriptions, benchmarks for salary and benefit expenses, base pay increases and turnover rates. An electronic version of the survey’s data tables is also available for purchase. This new offering allows users to apply formulas and insert the data directly into the credit union’s spreadsheets. Also available are CUNA’s Geographic Customized Salary Survey and Online Peer Comparison. The customized geographic report provides average and median base salaries and percentile figures for selected cities or geographic areas. The online peer comparison provides unlimited access to the 2008 salary survey database, which allows users to create customized peer groups using various criteria, such as: credit union name, asset size, number of members, field of membership, number of full-time employees, number of services offered, total loans outstanding, and geographic region. Customized report parameters include percentiles and date-specific trending. For more information, use the resource link.

Hundreds to build home this weekend for wounded vet

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GOLDEN, Colo. (6/17/08)--Hundreds of laborers and volunteers involved with the credit union movement will help build a home for wounded Iraq war veteran Staff Sgt. Travis Strong three days this weekend. Starting Friday morning, Colorado Lt. Gov. Barbara O’Brien, Democratic National Convention Committee CEO Leah D. Daughtry, Homes For Our Troops Founder and President John Gonsalves, and officials representing the National Journal and credit unions will begin to construct a home for Strong in a Homes for Our Troops Build Brigade event. Homes for Our Troops is a non-profit organization that builds homes for wounded American soldiers. The home will be located in Golden, Colo., and is a joint project with the credit union movement, the Democratic National Convention Committee and the National Journal Group. The Credit Union National Association, the Credit Union Association of Colorado and the Credit Union Association of Wyoming also have partnered to raise funds, provide donated materials and volunteer labor for the project. The home will be presented to Strong and his family around the time of the Democratic National Convention, Aug. 25 to 28 held in Denver. A similar event will take place in St. Paul, Minn., before the Republican National Convention.

Foundations prepare for aid appeal

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WASHINGTON (6/16/08)--The National Credit Union Foundation (NCUF) is appealing to credit unions and related organizations for online CUAid donations to assist credit unions affected by the floods in the Midwest. CUAid is the national disaster relief program for credit unions. Iowa Credit Union Foundation (ICUF) had been accepting donations last week when flooding began. But with more flooding projected for the weekend, ICUF Executive Director Marybeth Foster said Friday it expected to receive more disaster relief grant applications than it can fund. ICUF was capping grants at $500 for immediate emergencies. Donors from Iowa can use www.cuaid.coop/iowa. Those from other states can use their own state's CUAid.coop site or the national site, CUAid. All sites link to a CUAid grant application for Iowa flood relief. Donations made through CUAid for the Iowa flood relief effort will go toward grants. NCUF does not use disaster funds to pay for the CUAid.coop web platform or any costs it incurs in administering the national disaster relief program for credit unions. Donations will help address several needs:
* Critical needs: Credit union employees and volunteers can receive assistance for items for daily living such as, but not limited to, food, water, ice, batteries, clothing, diapers, temporary shelter, housing, gas and transportation. Grant applicants who no longer work in the credit union movement more than 90 days after the disaster are no longer eligible for CUAid disaster relief grants unless they actively work to return to the credit union movement. * Longer-term Recovery Needs: Even after recovering what they can from insurance payouts, victims may need assistance rebuilding or relocating to a new home, or replacing lost vehicles and household items. As long as funds remain in the Disaster Relief Fund, those managing the recovery efforts may expand the grant criteria to include longer-term recovery needs not fully covered by insurance. * Reasonable Operational Needs: Assistance may also be provided directly to credit unions and their support organizations to help them become and remain operational. These expenses may include relocating, setting up temporary service facilities, joining shared service networks, hiring temporary staff, mentoring and counseling traumatized staff, repairing building damage, replacing destroyed computer software/hardware, office furniture, office supplies, and other needs not fully covered by insurance. All purchases must be reasonable and of the same standards as being replaced. * Assisting Credit Union Members: While CUAid’s guidelines focus on providing support to assist credit union organizations, their employees and families, some funds may be used to provide disaster-related services to members.

Flood status of Iowa CUs updated

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DES MOINES, Iowa, and MADISON, Wis. (6/16/08)--Several credit unions in Iowa Friday reported closing or relocating due to extreme flooding in the area. Meanwhile, CUNA Mutual Group was assessing the impact caused by flooding in Iowa, Wisconsin, Minnesota, Illinois and Indiana. More than 20 credit union locations have been affected by the flooding in Iowa. The most severely impacted are those credit unions residing in Cedar Falls, Cedar Rapids, Des Moines and Waterloo. Those reporting changes in operation, as of Friday:
* Alliant CU, Dubuque, closed its Cedar Rapids branch; * Cedar Falls Community CU, Cedar Falls, reopened downtown branch Friday; * Collins Community CU, Cedar Rapids, closed seven branches yesterday and reopened five today; * Community 1st CU, Ottumwa, closed the Amana branch and two Cedar Rapids branches; * Des Moines Metro CU, Des Moines, relocated to First Class and United Service CU; * First FCU, Cedar Rapids, reported one branch under water; * Iowa Community CU, Waterloo, reported the Waterloo branch as under water. The Cedar Rapids branch is closed and has been relocated to Collins branch; * Metco CU, Cedar Rapids, relocated to Quaker Oats; * Midwest Utilities CU, Waterloo, closed; * Nishna Valley CU, Atlantic, reported that long distance phone lines down Thursday were back up Friday; * Quaker Oats CU, Cedar Rapids, closed at noon Thursday and reopened Friday; * University of Iowa Community CU, Iowa City, closed the Iowa Memorial Union branch; and * Veridian CU, Waterloo: closed the downtown Lafayette branch.
The Iowa Credit Union League continued to receive reports from Iowa credit unions affected by the flooding and will continue to provide support as needed. “Credit unions are executing their disaster recovery plans to the best of their ability, but no plan can completely account for the 500-year flood we’re experiencing in Iowa,” said Murray Williams, vice president of the Iowa Credit Union League. As rains continued to fall in the Midwest Thursday and Friday, more flooding was expected. CUNA Mutual Group was focusing its efforts on Iowa and Wisconsin. "Although the affected area is widespread, our particular focus is in Iowa and Wisconsin, where several whole communities have been evacuated," Phil Tschudy, media relations manager at CUNA Mutual, told News Now. He noted that because flooding is covered by federal insurance, there likely will be only a few coverages that will come into play for credit unions. However, "staff from our property and casualty claims area are continuing to contact credit unions in the affected areas to see how they are doing and to determine how we might be able to help," he said. As of Friday, "we have only a few policyholders reporting minor water damage; however, that will likely change as flood-related evacuations are occurring from Cedar Rapids to Des Moines, Iowa." He noted that federal officials were warning residences along the Mississippi River to be prepared for the worst flooding in 30 years. CUNA Mutual added a new Disaster Recovery Team link to its home page on cunamutual.com. It provides information credit unions need if disaster strikes and links to information on disaster prevention and preparation. Credit unions with damage claims can contact CUNA Mutual's Disaster Response Claims at 800-637-2676, which is available 24/7/365.

NCUF sponsors retired NYC fire chief at ACUC

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WASHINGTON (6/16/08)--Richard Picciotto, author of “Last Man Down: A Firefighter’s Story,” will be the National Credit Union Foundation (NCUF)-sponsored keynote speaker June 30 at the America’s Credit Union Conference & Expo in New York City. The retired New York City fire chief will give an eyewitness account of the events on 9/11 and a tribute to the lives lost that day. His account also is a celebration of life and its unpredictable nature. Picciotto also will share how the training strategies and tactics of the New York City Fire Department work to develop leadership, motivation, risk management and decision making. Also, Steve Delfin, NCUF executive director, will present a video message about CUAid, the only national disaster relief fundraising program exclusively benefiting the credit union community. After the general session, Picciotto will hold a book signing at the NCUF booth where attendees can learn more about CUAid.

Membership Growth Series Telco CU

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TARBORO, N.C. (6/16/08)--One of the biggest challenges Telco CU, Tarboro, N.C. faces in regard to membership growth is space. Telco CU grew its membership 19% from 2006 to 2007--to 10,929 members by focusing on select employee groups (SEGs). While the growth is welcomed, the more members Telco brings, the more space and back office support it must retain. “At first, when we grew our membership, they were coming in so fast it was hard to keep up. So the challenge is having enough space,” Telco CEO Charles Johnson told News Now. Telco recently added a new location--a combination call center and branch. It was built with the intention of freeing up space in Telco’s main branch and is used by members for basic transactions. “We were bulging at the seams at the main location,” Johnson said. This is the fourth 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. With Telco focusing its membership growth strategy on SEGs, Johnson, who started his post as CEO in March 2005, made a point to talk with all local businesses within Edgecomb County about sponsorship. As a result, the credit union went from about 25 SEGs to 100, he said. The SEGs vary in sizes. “We have large plants and small businesses,” he said. Telco is looking to target SEGs in three nearby counties in the future. Johnson conducted a study of the other counties to see what opportunities are available, and the credit union will begin pursuing relationships with those businesses. Population-wise, the counties are bigger, but geographically they are about the same as Edgecomb, he said. Within the SEG growth is a second challenge--serving a diverse group of people. Some credit unions have single sponsors, so they can specialize in one group’s needs, Johnson said. But with a diverse membership base, “you have to be alert to different needs of people,” he said. “It keeps you on your toes to make sure you’re serving all of the people you need to.” Telco offers a standard package of savings, checking and loan services and a credit builder program for those with weak credit history. The credit building program has four steps and members can start at any step as determined by the credit union. In the program’s first level, a member can take out a $500 loan. The member “walks out with $250 in his or her pocket, and retains the other half in savings,” Johnson said. The loan has a sixth-month repayment period. “It’s not so far out that they lose on interest,” he said. After they pay off the loan, they receive the other $250. They can withdraw that amount, or keep it in savings. After passing Level 1, the members can start Level 2, and follow the same process with a $1,000 loan. Level 3 offers a $1,500 loan and Level 4 offers a $2,000 loan. The credit union went to a risk-based lending program because members with low credit sometimes wanted up to $5,000. “It they stick to the program, they’ll get that amount. It’s just staggered in increments,” Johnson said. While completing the levels, the member has a four-year relationship with Telco. “We’ll then consider them for the standard loan package,” he said. Anyone who wants to contact the CUNA Membership Growth Task Force can e-mail the account established for this purpose at cunamgtf@cuna.coop.

NYIB announces seven youth advocate scholarships

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ALBUQUERQUE, N.M. (6/16/08)--The National Youth Involvement Board (NYIB) has selected seven credit union professionals for its annual scholarships, aiding the volunteer network’s objective to promote leadership development related to youth services and financial education. The awards cover conference and education fees, with five winners going to the July 28-31 NYIB Conference in Las Vegas, and two to the National Credit Union Foundation’s (NCUF) Credit Union Development Education (CUDE) program. Winners will be recognized at the 2008 NYIB Annual Conference, where the group’s Delegate of the Year and Volunteer of the Year also will be announced. Three credit union professionals have NYIB regional scholarships:
* West Region: Tana Jensen, Visa coordinator, Dakota Plains CU, Edgeley, N.D.; * Central Region: Greg Moeller, branch manager, Teachers CU, Goshen, Ind.; and * East Region: Toni Montgomery, community relations coordinator, AmeriChoice FCU, Mechanicsburg, Pa.
Danielle Scott, financial education leader at LA DOTD FCU, Denham Springs, La., will attend the NYIB Conference on the Robert L. Curry Scholarship and Award. Scott’s involvement fits closely with the principles of leadership development exemplified by Curry, a former president/CEO of CUNA Mutual Group. Another participant--Elizabeth Janowski, CEO/manager of STAR CU, Madison, Wis.--will attend NYIB’s annual conference under the “Serving the Underserved” Scholarship. The award recognizes individuals working with credit unions designated to serve low-income or underserved markets. NYIB will help send two network members to the NCUF CUDE program: Joann Bergrud, marketing manager, North Star Community CU, Maddock, N.D., and Rebecca Isaacs, business development director, the Credit Union Association of New Mexico, Albuquerque, N.M. The next session is Aug.14-20 at IslandWood on Bainbridge Island, Wash.

CUs offer loans to help members under water

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MADISON, Wis. (6/16/08)--Credit unions in several Midwestern states outlined what they're doing to help members and employees affected by the past week's severe weather. Many have employees and members directly impacted by flooding. At Centra CU in Columbus, Ind., 14 employees lost homes or cars, or experienced significant damage, said Nan Morrow, vice president of corporate development. Centra's relief program has three fronts: the members, the community and the employees, she said. For affected members, the credit union initiated a flood relief loan of $1,000 in immediate cash, with no payment for six months. "We're working with members who have existing loans and mortgages, and helping them determine what to do," Morrow told News Now Friday. Long-term concerns such as home equity will "last a long time Two branches of the $717 million asset credit union closed for half a day, she said, adding, "We're so thankful there was no internal damage." On Friday, all 22 branches and its ATMs were open. For the community, the credit union's staff donated to assistance organizations, such as the American Red Cross, and donated food and cleaning supplies. For employees, the credit union staff set up a voluntary assistance fund and a spread sheet with the lists of needs for each employee impacted by the floods. Other employees are donating items on the "registry." The credit union has also organized work teams to help clean up homes. "We're trying to help anyway we can," said Morrow Friday. Morrow noted that the area was under a thunderstorm watch and "we're expecting two more inches." In Terre Haute, Ind., more than 800 homes were damaged when a levee broke. Indiana State University FCU had "a handful" of employees experiencing water damage. According to Amanda Royer, marketing coordinator, the $74 million asset credit union launched a flood relief loan plan on June 7 and advertised it in the local newspaper on Thursday. The 5-5-5 loan offers 5% annual percentage yield, is for $5,000 maximum, and is a five-year loan. Employees get the same terms but are offered 0% on interest. Although Indiana State University FCU is less than a mile from the river, its member and employee parking lots were under water. "We're helping people who want to know what to do with their mortgage if their house is a complete loss. One of the professors lost everything. He was in the subdivision that was wiped out when the levee broke," Royer said. Westby (Wis.) Co-op CU has branches in four Wisconsin counties hard hit by floods: Vernon, Sauk, Monroe and Richland counties. Its Reedsburg branch experienced the most interruption of business--loss of communications with the main branch for two days--when the Baraboo River reached record levels. "We communicated by cell phone," said President Kevin Hauser, a board member of the Wisconsin Credit Union League. The credit union kept its drive-up open to make sure members had service. To process transactions, it would communicate the transactions to other offices, which would post the transactions via a dedicated line. "It was important to get to the point we could post transactions. Our members needed the cash," Hauser told News Now. Several employees couldn't get to work because of flooded or washed away roads. Many members were displaced in Ovolka, Ontario, LaFarge, Viola, Soldiers Grove and Gays Mills--all under water. The credit union went through a similar heavy flood last fall, he said. Then, it waived overdraft fees for the entire credit union for two days--even for members not impacted by the flood. "It was our way of thanking them for their membership and urging them to help someone else in need," Hauser said. Last fall, it also authorized deferment on payments up to three months for members who requested it and even waived the early withdrawal penalty on a member's certificate. Staff in Reedsburg also is helping the community by taking their casual day fund and donating it to the American Red Cross, by providing workers with food, and by filling sand bags. The credit unions were bracing themselves for a wet weekend, with more storms to compound the problems. Centra's Morrow noted that the area was under a thunderstorm watch and "we're expecting two more inches."

CUNA Mutuals crop insurance provides flood relief

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MADISON, Wis. (6/16/08)--CUNA Mutual Group can help with recent flood relief efforts in the Midwest since it provides multi-peril crop insurance coverage to farmers and agricultural producers nationwide. Crop insurance protects farmers from financial losses that result from natural causes such as drought, excessive moisture, hail, wind, frost, insects and disease. Multi-Peril Crop Insurance is a $5-billion industry in the U.S., CUNA Mutual said. In 2007, CUNA Mutual and partner Producers Ag Insurance Group (Pro Ag) reported a combined total of $350 million in premiums paid for crop insurance, Phil Tschudy, CUNA Mutual media relations manager, told News Now. “As far as potential losses and claims, it is too early to assess now,” Tschudy explained. “Adjusters won’t be able to get to affected areas until flood waters recede, and some of the crops might be replanted yet. However, there will be an impact in areas where we write business.” CUNA Mutual entered into an agreement in August 2006 with Pro Ag, an Amarillo, Texas-based crop insurer. CUNA Mutual purchased a minority ownership share in the company in September 2007. “Our investment in Pro Ag and the crop insurance business is an example of CUNA Mutual growing in the right direction,” Jeff Post, president/CEO of CUNA Mutual, said at the time of the purchase. “At the same time we build capacity for growth, we remain firmly committed to the credit union market. The values that have served us well with credit unions will also serve as strengths in serving America’s farmers.” The agreement will enhance CUNA Mutual’s flexibility and financial strength through profitable revenue growth, improve the diversity of products, and create opportunities to help credit unions grow membership. “Credit union CEOs have told me repeatedly that membership growth is their No. 1 issue. By expanding into crop insurance, we can grow our company and contribute to the growth of credit unions,” Post said. “We will continue to explore strategic partnerships that can help CUNA Mutual, and credit unions grow in the future. “America's farmers share many of the values of the credit union movement and the cooperative spirit--with numerous cooperative businesses supporting the farming industry,” Post added. “I’m pleased we can promote the value of credit union membership and products to the farming industry.”

Latino CU conference Start simple in serving Hispanics

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FARMERS BRANCH, Texas (6/16/08)--The opportunities for credit unions to open their doors to the Hispanic population has never been greater, Juan Hernandez told attendees of the Fifth Latino Credit Union Conference in Dallas this week. Hernandez is a former cabinet member of the Mexican government and a credit union member (LoneStar Leaguer June 13). Hispanics represent a large percentage of the unbanked. “They are not only being robbed by check cashers, payday lenders and pawnshops, but also by criminals who know they bank out of their back pocket,” he said. Credit unions should have a physical presence in Latino communities, listen to them, and “be there when it counts. But before launching any initiatives, credit unions need to do research, train staff, build infrastructure and develop processes for serving Latinos,” he said. Rene Vasquez Perez, director of institutional development for Caja Popular Mexicana (CPM), the largest credit union in Mexico, said credit unions should:
* Make the account opening process easy; * Make sure immigrants know their deposits are insured and safe; * Be in Latino neighborhoods and set hours of operation accordingly; and * Have a staff trained to answer their questions.
CPM signed a people-to-people partnership with the Texas and California Credit Union Leagues in 2002. The conference was organized by the National Federation of Community Development Credit Unions in collaboration with the Network of Latino Credit Unions and Professionals, with sponsorship by the Texas Credit Union League.

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)

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.

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.

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.

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.”

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.

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.

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.

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.

N. Mexico CUs grow serve the underserved

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SANTE FE, N.M. (6/12/08)--Several Sante Fe, N.M., area credit unions are experiencing growth and are reaching out to serve the underserved, an article in The Sante Fe New Mexican noted Tuesday. Del Norte CU, a $302 million asset, Los Alamos, N.M-based credit union, is designed to serve the underserved and its 42,000 members know that, Guy Lisella, Del Norte vice president of marketing, told the newspaper. The credit union is not designed to collect as many fees as it can, and members can tell the difference in the experience of going to a credit union, as opposed to going to bank, he added. Guadalupe CU, a $69 million asset, Sante Fe-based credit union, recently opened two new branches--one near a supermarket and the other in the fastest growing part of the city, the newspaper said. The new branch, near the fastest growing area, “offers a fully bilingual staff, financial counseling and nontraditional products,” Guadalupe CU said in a statement. One product is a payday loan alternative with significantly lower costs than traditional payday loans, the credit union told the paper. The Guadalupe branch also offers financial counseling and check cashing for $3 per check, which it says is lower than traditional check-cashing facilities. Permaculture CU, a $3.2 million asset, Sante Fe-based credit union, makes loans to help sustainable projects that “take care of the earth,” according to its website. The credit union’s membership increased 51% in the past year, Donald Sarich, Permaculture president/CEO, told the paper. The credit union helps members with loans to make their homes and cars more energy efficient, because people are interested in sustainability, Sarich added. Permaculture’s assets also went up $625,000 last year. Northern New Mexico School Employees FCU, a $13.2 million asset, Sante Fe-based credit union, opened its 14th branch in the state, and its first in Sante Fe, during the first first quarter of 2007, the paper said. The credit union expects to start construction on another branch site in late spring 2009, it said. From the end of 2006 to the end of 2007, credit union membership went up 2.83%, according to the Credit Union Association of New Mexico. This growth is due to a new awareness of credit unions that had not been there before and the fact that increasing numbers of credit unions are more accessible to various groups, association spokeswoman Mary Beth King told the paper.

Fraudulent checks change hold policy at CU

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JACKSON, Miss. (6/12/08)--Seeing a rise in the amount of counterfeit checks in the past six months, Mississippi FCU has decided to implement a new hold policy on all checks that come through the credit union. “We initiated a hold on checks for a longer period of time,” Marilyn Hobson, president, Mississippi FCU, told News Now. “We use our discretion when doing this. It is based on the history of the member.” If a check or circumstance seems suspicious in any way, the credit union will hold a local check for seven days, a non-local check for 11 days--up from the previous hold policy of five days for a local check and seven days for a non-local check. “For example, if someone has an average daily balance of $3.52 for the past year and then brings in a check for $5,200, we’ll put a hold on it,” Hobson said. “Also if a check is for $2,500 or more, we’ll call the financial institution it is drawn on. Not in front of the member, but later on. “We know our members pretty well, so we’re not above saying to them, ‘tell me about this check’ if it seems suspicious. We just try to use a lot of common sense,” she added. Mississippi FCU also goes online daily through a process called “in-view” to see returned check images, instead of waiting three more days to see them in the mail. “It’s wonderful,” Hobson said. The credit union also uses a machine called a “money checker” that employs a light to view the watermark on checks to look for counterfeits, and magnetic strips on bills to check for counterfeit money. “It’s inexpensive, and we use it a good bit,” Hobson said. One of the more prevalent scams in her area involves people receiving letters asking them to be secret shoppers at various stores, Hobson added. The solicitor promises participants money for this, and sends them a check for $4,500. Then the solicitor asks them to send a money order for $3,000 and tells them to keep the $1,500 balance as payment for their efforts. The problem is that the $4,500 check is fraudulent and the participant is out $3,000, Hobson said.

CMN hospitals among Americas Best--USNandWR

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RESEARCH TRIANGLE PARK, N.C. (6/12/08)--Last week's issue of U.S. News & World Reports recognized the Credit Unions for Kids program for its contributions to the Children's Miracle Network (CMN) in its "America's Best Children's Hospitals" edition. CMN partnered with the publication to highlight the teamwork of hospitals, sponsors and media partners working to provide the finest in pediatric health care, according to Joe Dearborn, managing director of Credit Unions for Kids. "America's Best Children's Hospitals" ranks the top 30 hospitals in seven areas: general pediatrics, cancer, digestive orders, heart and heart surgery, neonatal care, neurology and neurosurgery, and respiratory disorders. "We are extremely proud that the top 10 children's hospitals, as selected by U.S. News & World Report, are Children's Miracle Network hospitals," said Jim Hall, CMN president/CEO. "It is support from programs like Credit Unions for Kids that enable these hospitals to provide such world-class, specialized care," Hall noted. Of 143 hospitals considered eligible for the rankings, 113 responded. The research, conducted by RTI International, combines data from a survey of physicians, a direct survey of pediatrics hospitals (including freestanding children's hospitals and children's "hospitals within a hospital"), and other resources. Each hospital's score is based on key components such as outcomes (including mortality rate and readmission rate), reputation, and care-related considerations such as specialized patient services, nursing care and advanced technology. These represent three key aspects of quality hospital care: structure, process and outcomes. For the rankings, use the "America's Best Children's Hospitals" resource link.

Ohio foundation marks 1 million in grants to CUs

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DUBLIN, Ohio (6/12/08)--Ten years after it began fundraising, the Ohio Credit Union Foundation (OCUF) has passed the $1 million mark in grants made to credit unions. "This is a special milestone that reflects positively on the value-driven mindset and giving nature of credit unions in Ohio,” said Kathy Kanipe, CEO of Parish FCU, Toledo, and chair of the OCUF Board of Trustees. “The Foundation will continue its great work, supported by its board members and hundreds of generous donors, and I see no reason why we will not be celebrating a similar milestone in another 10 years, if not sooner.” The grant that eclipsed the $1 million mark was awarded earlier this year to Chivaho CU, Chillicothe to assist Chivaho CEO Laura Roberts her with her third year of tuition for CUNA Management School. The foundation grants also assisted Roberts with two previous years of management school. She will receive her diploma this summer. OCUF was incorporated in 1997 and began grant making in 1998 to support individual credit unions’ education and outreach initiatives that promote financial independence. It focuses on five major values:
* Promoting financial education to benefit credit union members, Ohio students, and the public; * Helping credit unions implement programs in their communities that fulfill their social responsibility to make financial services affordable and accessible to all members; * Providing professional development grants to assist credit union employees and volunteer leaders; * Offering financial relief to credit unions, their employees, members, and their communities in the wake of natural disasters; and * Empowering people to improve their financial well-being, based on the values of self-help, self-responsibility, democracy, equality, and equity.
The foundation also supports national credit union efforts and is the third largest contributor to the Biz Kid$ television program. In 2007, it also provided $10,000 to the National Credit Union Foundation to assist California wildfire victims and $5,000 to the World Council of Credit Unions for earthquake relief in Peru. OCUF's 2008 fundraising goal is $280,000, an increase of nearly 60% from the $167,000 raised in 1998. The foundation plans to award $250,000 in grants in 2008.

Members United Corporate board election announced

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WARRENVILLE, Ill. (6/12/08)--At its annual meeting on Friday in Chicago, the members of Members United Corporate FCU re-elected individuals to its board of directors. The following will serve three-year terms:
* Terry R. Brahm, president/CEO, DHCU Community CU, Moline, Ill.; * Gary E. Furtado, president/CEO, Navigant CU, Smithfield, R.I.; * Nancy Kasprzak-Whitmore, president/CEO, Niagara County’s FCU, Lockport, N.Y.; and * Kyle Markland, president/CEO, Affinity Plus FCU, St. Paul, Minn..
The board also elected officers to serve a one-year term:
* Chair: John T. Fenton, President/CEO, Affinity FCU, Basking Ridge, N.J.; * Vice Chair: Markland; * Treasurer: Louis H. Jimenez, Treasurer/CEO, Montauk CU, New York City; * Secretary: Lloyd M. Fredendall, President/CEO, NorthStar CU, Warrenville, Ill.
Members United’s additional board members are:
* Bruce M. Beaudette, president/CEO, Sunmark FCU, Latham, N.Y.; * Donald H. Briggs, president/CEO, NorthEast Alliance FCU, Nanuet, N.Y.; * John R. Caulfield, president/CEO, St. Mary’s CU, Marlborough, Mass.; * Andrew L. Jaeger, president/CEO, Credit Union of New Jersey, Ewing, N.J.; * Ronald Linstromberg, CEO, DeKalb Financial CU, Auburn, Ind.; and * Michael Phipps, president/CEO, Evansville (Ind.) Teachers FCU.
Serving as an associate director is Edward J. Gvazdinskas, president/CEO, Heartland CU, Springfield, Ill. Members United Corporate FCU is a $13.8 billion, Warrenville, Ill.-based financial institution that provides service to 2,300 credit unions nationwide.

CU System briefs (06/11/2008)

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* LIHUE, Hawaii (6/12/08)--Kaua'i Community FCU last weekend warned members and non-members of a vishing scam using the credit union's name. Vishing involves text messages sent to victims using a financial institution's name to try to lure recipients into sharing sensitive information such as account numbers. Potential victims were notified that their account was locked. The message instructed them to call a phone number to restore account access. The credit union worked with Internet security experts to shut down the bogus phone numbers and warned that it would not ask members to submit personal financial information over the phone (The Garden Island June 9) … * PASADENA, Calif. (6/12/08)--Wescom CU is offering reverse mortgages to members who are senior homeowners so they can tap into the equity in their homes, the $3.7 billion asset credit union announced. The reverse mortgage enables homeowners age 62 or older to convert home equity into cash without moving or making loan payments. Wescom will work through Reverse Mortgage Lending (RMLI), its mortgage lending company. RMLI will manage the entire loan process, including counseling, application, origination and funding preparation, then place the loan with a reverse mortgage lender for funding and servicing … * FORT WORTH, Texas (6/12/08)--American Airlines FCU will host an aviation industry celebration, "Fun Takes Flight," June 21 that will honor CEO John M. Tippets' 42 years of service with AMR Corp. and 17 years service to the credit union. Tippets also will sign his newly published book, Hearts of Courage, about his father's 29-day survival after a 1943 plane crash in Alaska. The event will be held at the American Airlines C.R. Smith Museum in Fort Worth. The celebration will include special offers, free educational seminars, and auto show with hybrid cars, and more, and will offer a document shredder so members can shred sensitive documents … * CAPITOLA, Calif. (6/12/08)--To ensure that Bay FCU met its
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fundraising goal for Children's Miracle Network (CMN), 13 employees at the credit union shaved their heads at an employee meeting June 4. Bay FCU donated $35,020 this year to CMN, a record for the $600+ million asset credit union. Senior management donated an extra $1,000 and, at the request of staff, $50 for each staffer who volunteered for the shave. From left are employees Ashton Holtzinger, Dan James, Mauricio Rivera, Tomas Garcia, Chris Hanson, Doug Kuepfer, Linwood Parson, Phil Alberti, Manuel Escarcega, Jordan Behmke, Dominic Bitoni, Bradley Bishop, and Cameron Haste. With them are Kendra Howell (holding check), director of corporate and community development for Salinas Valley Memorial Hospital. On the right in red is Carrie Birkhofer, Bay FCU president/CEO. Since 1998, Bay Federal has raised more than $100,000 for CMM. (Photo provided by Bay FCU) …

Latino Community CU chair named N.C.s CU person of year

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DURHAM, N.C. (6/12/08)--Latino Community CU (LCCU) Chairman John Herrera received the Ronald J. Hutchins Credit Union Person of the Year Award Monday for his volunteer work in the credit union movement at the North Carolina Credit Union League’s 73rd Annual Meeting. The award is given annually to persons who demonstrate exceptional qualities of leadership in their credit union and who display outstanding dedication to the credit union movement. “Herrera has ‘made it in America’ and now he gives back through his compassion and commitment to his country, his community and his credit union,” said Jim Blaine, president, State Employees CU, Raleigh. Herrera is one of the founders of LCCU in Durham, which provides low-cost products and services to its members, especially low-income members. Herrera is often contacted by organizations seeking advice and support to develop financial institutions that serve the unbanked and immigrant communities, including a Nobel Prize-winning bank that plans to expand its model to the U.S. He is also vice president of Latino affairs for the Center for Community Self-Help, a community development financial institution intermediary, which provides support to community development credit unions that serve minorities. He also is a board member for the North Carolina Minority Support Center. Herrera was the first Hispanic elected to the Board of Alderman in Carrboro in November 2001, becoming the first Hispanic immigrant ever elected to municipal office in North Carolina. He was re-elected in 2005.

Land legislation means that PSECU will stay in county

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HARRISBURG, Pa. (6/12/08)--Pennsylvania State Employees CU (PSECU), Harrisburg, has been approved by the state legislature to buy 47 acres of land in Susquehanna Township for a new headquarters building. The State House of Representatives approved House Bill 2496, introduced by Rep. Sue Helm (R-17th District), to sell the land to the credit union for $3.05 million, the Pennsylvania Credit Union Association (PCUA) said (Life is a Highway June 11). PSECU is paying “fair market price” for the land. An appraisal was accepted by the state Department of General Services, the association said. The new headquarters will house 500 employees and accommodate PSECU’s growth for the next 50 years, the association said. The headquarters also will create jobs in the county, Helm told the association.

CUs in Oregon raise 866000 for CUs for Kids

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BEAVERTON, Ore. (6/12/08)--Credit unions in Oregon and southwest Washington raised more than $866,000 during their 2007 campaign for Credit Unions for Kids. The amount is the second-largest collected in the program's 22-year history in Oregon and the Washington area. The funds complete a $1 million commitment made with Doernbecher Children's Hospital to endow the Credit Unions for Kids Professorship in Pediatric Neurology. The funds also complete a two-year goal to raise $50,000 for the NICU Parent Lounge at Sacred Heart Medical Center, Eugene, Ore., and $30,000 for a family waiting room at the Family Birth Center at Rogue Valley Medical Center, Medford, Ore. "Once again, they (credit unions) have gone above and beyond for the children of their communities," said Kasey Rockwell, director of credit union advocacy for the Credit Union Association of Oregon. Rockwell is the statewide Credit Unions for Kids campaign director. Next up: credit unions in Oregon and southwest Washington will raise funds to complete a $1 million pledge to the Doernbecher Pediatric Neurosciences Research Program at the Oregon Health and Science University. The funds will help recruit another researcher to the team, secure core equipment and activate a robust lab, which will be named for Credit Unions for Kids. The group is exploring further fundraising for Sacred Heart Medical Center and Rogue Valley Medical Center.

AARP study gives poor grades to FIs communication

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TEWKSBURY, Mass. (6/12/08)--Credit unions may want to note a recent nationwide survey that indicates that the financial services industry isn’t effectively communicating with consumers. AARP Financial, a subsidiary of the American Association of Retired Persons (AARP), found that more than half of adults surveyed said they have made an investment with an unfavorable outcome because they felt confused or didn’t understand an investment. “The relatively straightforward process of saving for the future has become incredibly complicated,” said Richard Hisey, AARP Financial chief investment officer. “As a result, many American investors have saved too little--most with less than $50,000 for retirement--or are too intimidated to get started in the first place,” he said. About 54% said they do not read financial literature because it’s too hard to understand, and 41% said information from financial services companies is not helpful. Two-thirds of survey respondents graded the financial services industry with a “C,” “D,” or “F.” More than 70% said financial professionals use more jargon than their car mechanic, and more than 50% said they use more jargon than doctors. “We’ve made it incredibly easy for Americans to spend and create debt, but unnecessarily difficult to invest comfortably and with confidence,” Hisey added. Respondents said they feel the jargon is intentional. What’s more:
* 54% believe jargon is used to distract people from focusing on the fees they will pay; * 78% said they believe materials from financial companies are more about selling than educating; * 63% said jargon is used to make a product seem more impressive; and * 49% believe jargon is used to make consumers feel less confident that they can handle their own finances.
“No one is well-served by this confusion,” Hisey said. “We talk a lot about transparency in this industry but not enough about simplification and understanding. What value does disclosure bring if the average investor can’t comprehend it?” The survey of 1,203 adults, age 18 or older, was conducted by telephone from Jan. 23 to Feb. 10.

Oregons OCUL Services announces new board

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BEAVERTON, Ore. (6/12/08)--OCUL Services, the services corporation for the Credit Union Association of Oregon (CUAO), has named a new board of directors and has reorganized its structure. OCUL Services restructured its board to allow having between three and seven board members, with five the target number. The new board includes:
* Chair: Gene Pelham, CEO, Rogue FCU, Medford; * Treasurer: Bill Anderson, CEO, Mid Oregon FCU, Bend; and * Director: Mark Zook, executive vice president/chief operating officer, MaPs CU, Salem.
Stepping down from the board is Carol Cromwell, CEO of Linn-Co FCU, Lebanon.

Former Centrix owner appeals liquidation order

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DENVER (6/11/08)--The former owner of Centrix Financial LLC--a subprime auto lending service that serviced credit unions and that is in Chapter 11 bankruptcy--has filed a notice of appeal of a liquidation plan approved earlier this year by the U.S. Bankruptcy Court. Robert E. Sutton, the former owner, and two entities--6762 S. Potomac LLC and Centrix Consolidated LLC--filed papers stating the issues on appeal Friday through attorney G.W. Merrick in the U.S. Bankruptcy Court for the District of Colorado. The appeal seeks to address whether the U.S. Bankruptcy Court erred in several rulings it made, including a ruling confirming the Chapter 11 reorganization, according to court documents obtained by News Now. Judge Elizabeth E. Brown had approved the reorganization plan on April 21, after almost two years of court maneuverings in the case by a growing list of participants. The notice of appeal also takes issue with the court ordering the appellants to cease-and-desist from filing claims objections and the court's overruling of Sutton's objections to the liquidation confirmation. The reorganization would have involved Centrix and its seven affiliates under bankrupty protection to consolidate into a single entity, with Centrix assuming all the affiliates' assets and liabilities. It would pool the resources to pay each affiliate's creditors (News Now Jan. 22). Credit unions and other entities have claimed millions against the company's assets. More than two-thirds of Centrix's portfolio is owned by roughly 230 credit unions throughout the nation. It underwrote more than 250,000 loans totaling $4 billion (News Now Sept. 6, 2002). The reorganization was considered the best opportunity for creditors-- including credit unions--to secure any money that might be handed out through the liquidation process (News Now April 25). Sutton's appeal would delay the distribution process of any funds. Centrix was placed under involuntary Chapter 11 protection on Sept. 15, 2006 by creditors IFC Credit Corp., Suntrust Leasing and Wells Fargo Equipment Finance Inc. They said Centrix owed them a combined $4.6 million in lease payments. Several days later Centrix and its affiliates filed voluntary petitions for Chapter 11 protection.

CU System briefs (06/10/2008)

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* NAPERVILLE, Ill. (6/11/08)--The Illinois Credit Union System has contributed $6,000 toward building two veterans' homes during the 2008 national party conventions in Denver and St. Paul, Minn. The Credit Union National Association (CUNA), leagues and credit unions from across the nation will team up with "Homes for Our Troops" to build specially adapted homes for two severely injured veterans and their families. One home will be in Denver; the other in St. Paul, Minn. The host leagues--the Credit Union Association of Colorado and the Minnesota Credit Union Network--are working to obtain donations and volunteers locally, and credit unions throughout the nation are contributing donations for the events. Illinois Credit Union League President/CEO Dan Plauda urged credit unions to join in the cause, which "exemplifies the 'people helping people' philosophy of the credit union movement." … * RALEIGH, N.C. (6/11/08)--State Employees' CU in Raleigh collected more than $43,000 for March of Dimes March for Babies spring event. More than 160 SECU team members walked in the three-mile march. This year, branch and operations employees participated in numerous fundraisers, including bake sales and raffles, to raise funds. SECU's 2008 total was $7,000 more than the amount collected last year (Carolina Newswire June 6) …

Iowa growth commission focuses on five areas

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DES MOINES, Iowa (6/11/08)--The Iowa Credit Union Growth Commission will review industry trends and market research as it relates to credit union growth in five key areas. The commission was created by the Iowa Credit Union League board of directors in 2007 to offer recommendations for credit union growth strategies. At a time when credit union membership growth in Iowa is generally stagnant, credit union members are aging, competition is increasing, margins are shrinking, and new markets are emerging, the growth commission recognized the need to focus on strategic, innovative and collaborative ways to serve Iowans in the future, said the league. Comprising 23 Iowa credit union leaders, the commission spent more than six months reviewing research and discussing the future of the credit union movement. Their meetings, facilitated by John Lass, senior vice president, product development, CUNA Mutual Group, led to the identification of five key areas to help stimulate growth in Iowa. These concepts include:
* Back office support; * Human resources support; * Marketing support; * Mobile banking; and * Virtual banking.
The commission plans to complete research to assess the needs of the marketplace, specifically for the back-office support, human resources support, and marketing support areas by the end of the summer. With the market research in place, the league will conduct a financial analysis to determine the most viable solutions and will begin developing business plans and product launches only if needed. “The growth commission members dedicated many hours of their time and energy to this initiative,” said Patrick S. Jury, league CEO. “Because of their thoughtful opinions and desire to help the credit union movement, we have been able to identify key areas that will make the Iowa credit union movement stronger.” Chairing the commission are: Jean Hoeger, co-chair, Alliant CU, Dubuque; and Mark Heth, co-chair, Iowa Community CU, Waterloo. The league also developed a new position in 2007, the director of credit union growth. In that position, Jim Niederhauser is responsible for managing the commission efforts and aligning with Iowa credit unions to evaluate growth strategies for their future The Iowa Credit Union League also has created several subsidiary companies focused on helping credit unions grow. In 2005, the league established Community Business Lenders, a credit union service organization (CUSO) that provides credit unions with the resources and third-party support to offer member business loans to small business owners and individuals. In 2006, the league launched Coopera Consulting, an Iowa-based agency that helps credit unions reach out to emerging markets.

Hannaford breach lawsuits consolidated under one judge

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PORTLAND, Maine (6/11/08)--More than 20 lawsuits filed in four states over a recent data breach of grocery chain Hannaford Bros. Co.'s computer network have been consolidated under one judge in Portland, Maine. The decision, by a seven-judge panel meeting May 29 in Asheville, N.C., was announced Monday (Bangor Daily News and Associated Press via Boston HeraldJune 10). It means that the lawsuits already filed--and any filed in the future-- will be consolidated under the federal court's multi-district litigation program and be heard in Portland by U.S. District Judge D. Brock Hornby. The panel's order indicated that centralization in Maine would be convenient to the parties and witnesses, and promote the "just and efficient conduct" in the court. Hannaford's headquarters is in Maine and relevant documents would be easier to make available there, the panel said. Attorneys for victims who filed lawsuits in Florida had asked the cases to be consolidated there. The lawsuits stem from a breach from Dec. 7, 2007, to March 10, which allowed hackers to steal the credit and debit card numbers of 4.2 million Hannaford customers while they swiped the cards for authorization of purchases at grocery stores. It was the first major breach of a system that was compliant with industry standards. The breach affected customers at about 300 stores--most of them Hannaford stores and Florida's Sweetbay chain. When the breach was made public, the Maine Credit Union League noted that Maine's credit union and banks would feel the brunt of the attack. At that time, 68 credit unions in the state were reissuing more than 100,000 credit and debit cards to try to limit the amount of fraud (News Now March 24). As of June 1, at least 23 lawsuits related to the breach were filed: 14 in Maine, seven in Florida, one in New Hampshire and one in New York. Judge Hornby is expected to assign a team of attorneys to act as lead counsel on all the cases by the end of June, said the Bangor Daily News.

Federation CEO addresses World Social Finance Summit

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NEW YORK (6/11/08)--Because of the subprime crisis, “the dominant financial system in the U.S. is being questioned in a way it has not been before,” Cliff Rosenthal, president/CEO, National Federation of Community Development Credit Unions, told the World Social Finance Summit. The meeting of socially oriented cooperatives, banks and policy advocates was held in Quebec, Canada, Thursday. The catastrophic losses and the widespread economic distress present “an unprecedented opportunity to bring the credit union and cooperative message to millions of Americans,” Rosehtnal said. Rosenthal found broad agreement with his assessment of three major challenges faced by social and cooperative finance institutions across national lines. “First, global capital standards designed with large banks in mind are a major threat to the survival of smaller, socially oriented institutions,” he said. “A second major threat comes from the increasing crush of regulations, which again have a disproportionate effect on small institutions. Finally, there is the threat of demutualization, or conversion to for-profit status with the loss of mission.” The summit was organized and sponsored by the Belgium-based International Network of Investors in the Social Economy and, locally, by Quebec’s Desjardins Caisse d’economie Solidaire, a member of the Desjardins credit union network. Over 150 delegates attended from five continents, from as far away as Togo and Cameroon, Scandinavia, Brazil, the Philippines, British Columbia, and Australia. Stressing the urgency for action, conference speakers laid out a series of interrelated crises: The financial crisis, the energy crisis, the environmental crisis, the escalating food crisis, and a growing water crisis. In every sense of the word, the present situation is “unsustainable,” they said. The financial system, in particular, must be transformed: instead of making people merely a means to produce profit, finance must serve human needs, speakers agreed. Return on investment must account for environmental and social costs, they added. The conference closed with a declaration signed by the participants, including the federation, which affirmed the basic common values underlying the social finance movement: Placing human needs first.

Idaho league names pro volunteer of year

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BOISE, Idaho (6/11/08)--The Idaho Credit Union League has named the winners of this year’s Outstanding Professional of the Year and Outstanding Volunteer of the Year Awards. Brent Neibaur, CEO, Advantage Plus FCU, Pocatello, was presented the Outstanding Professional award at the league’s 72nd meeting. Jim Simpson, board chairman, Magic Valley FCU, Twin Falls, received the Outstanding Volunteer Award. Neibaur has been with Idaho credit unions for nearly 20 years and places a high value on member and employee relations, the league said. He is committed to education and training for employees of all levels, striving for longevity and continuity, and earning staff support and loyalty, the league added. Simpson’s credit union praised his contributions during his tenure on its board of directors, which spans dour decades. During his time of service, Simpson has missed few meetings. Although his current position on the credit union board is chairman, he has held a number of leadership roles throughout his years of service. In addition to receiving plaques and diamond pins from the league, donations of $250 will be made to the National Credit Union Foundation in their names.
Jim Simpson, Magic Valley FCU, Twin Falls, received the Outstanding Volunteer Award at the Idaho Credit Union League’s 72nd meeting in Boise. (Photos provided by the Idaho Credit Union League)
Brent Neibaur, CEO, Advantage Plus FCU, Pocatello, was presented the Outstanding Professional award at the Idaho Credit Union League’s 72nd meeting in Boise.

Illinois CUs take next steps with REAL Solutions

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NAPERVILLE, Ill. (6/11/08)--Partner credit unions involved with Illinois’ REAL Solutions effort recently met at the Illinois Credit Union League (ICUL) headquarters to discuss their next steps to add programs and products to serve low-wealth households. REAL Solutions is designed to help credit unions offer services that have proven successful in serving people of modest means, working families and low-wealth households. REAL Solutions is a National Credit Union Foundation program offered nationwide. Thirty credit unions have signed up for REAL Solutions in Illinois, ICUL said. The credit unions will focus on a number of initiatives, including payday alternative loans, youth and young adult programs, immigrant outreach programs, member education, check cashing and voluntary income tax assistance (VITA). Other focus areas include first-time homeowner programs, stored-value cards, asset building savings programs and safe accounts. During the meeting, credit unions participated in a diagnostic interview with REAL Solutions field coach Mark Lynch, who gathered information on products and services that the participating credit unions offer and areas of interest for future programs. The group found that:
* Asset size for partner credit unions ranges from less than $1 million to more than $1 billion; * Ten partners have a payday alternative loan product; * All partners said they want to learn more about payday alternative loan products; * Five partners offer formal financial and credit counseling programs to members, while 16 offer information programs; and * All 30 said growth is a primary business focus.
The next meetings are scheduled for June 26 and July 23 at the ICUL. At the meetings, speakers will present information on payday lending and VITA.

N.J. league board proposes new structure

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HIGHTSTOWN, N.J. (6/11/08)--The New Jersey Credit Union League board of directors is proposing a new governance structure. Due to changing demographics and new challenges, the league decided to take on the task of governance restructuring last year.
From left) New Jersey CU League Chairman Steve Schlundt, NJCUL President/CEO Paul Gentile and NJCUL Board Member Shawn Gilfedder prepare for a special Webcast announcing the proposed governance changes. (Photo provided by NJCUL)
The league board appointed a 14-person Governance Task Force to recommend to the board a new structure (The Weekly Exchange June 9). “We recognized as a board that it was time to evaluate our governance structure and see if we could make changes that would make us a more efficient league,” said Steve Schlundt, league chairman and CEO, Atlantic City Fireman’s FCU. “By doing so, we feel it will improve the way we do business, and most importantly, help us with our primary task of meeting the needs of our members.” Some of the changes the new structure would bring to the league are:
* Board reduction: The board size would be reduced from 15 to nine; * Term limits: Board members could serve three consecutive three-year terms; * Asset representation: Three directors would be elected from three tiers: Tier A, including less than $25 million in assets; Tier B, more than $25 million in assets; and Tier C, credit unions of any asset size (at large); * Board qualifications: Candidate must be either a board member or president/CEO (or equivalent) of an affiliated credit union in good standing; * Voting rights: Credit unions will vote on candidates in their tier, as well as the at-large tier; and * Timing: If approved, the new election rules will be immediately implemented for the 2009 elections cycle, with the newly elected board seated in 2009.
The league board has approved the restructuring changes. The final step before implementation is the membership vote, which will take place at the league’s annual meeting Sept. 21-23. The changes will be distributed next week to New Jersey credit unions through a webcast, according to Paul Gentile, president/CEO of the New Jersey Credit Union League. He said the webcast is just one of many methods of communication the league will use to ensure everyone is aware of the changes. "It is our duty at the league to ensure members are fully informed about the governance bylaw amendment and what it means to the structure of the league board," he said. "It is in the hands of the membership and they must be educated well in advance of our annual meeting this September."

CUs in Idaho raise 211000 for CMN

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BOISE, Idaho (6/11/08)--Idaho credit unions raised more than $211,000 for Children’s Miracle Network (CMN) through their Credit Unions for Kids Program in 2007. The donation brings the 13-year total to more than $1.5 million raised by Idaho credit unions for CMN, said the Idaho Credit Union League. Of the money raised, 100% goes to benefit sick or injured children in the state. Funds raised in the southeast region are given to Children’s Primary Medical Center in Salt Lake City; those from the south, southwest and south central regiona are donated to St. Luke’s Children’s Hospital; and funds raised in the north and north central regions benefit CMN facilities in Spokane, Wash., and Coeur d’Alene, Idaho. Credit unions donating the largest amounts are:
* Cornerstone CU, Caldwell; * East Idaho CU, Idaho Falls; * Idadiv CU, Nampa; * Idahy FCU, Boise; * Inkom Cement Employees CU, Inkom; * Lewis Clark CU, Lewiston; * Pine Tree Community CU, Grangeville; * Pocahy Family CU, Pocatello; * Potlatch No. 1 FCU, Lewiston; * Pocatello Railroad FCU, Pocatello; * Quinco CU, Nampa; and * SEI-US Employees FCU, Pocatello.

N.Y. foundation unveils 10 ID-theft video PSAs

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ALBANY, N.Y. (6/11/08)--The New York Credit Union Foundation recently unveiled at a reception in Albany a series of 10 video public service announcements (PSAs) that are part of a statewide educational and consumer campaign about identity theft.
New York State Assemblyman James Tedisco (left) (R-Capital) spoke at the introduction of public service announcements aimed at preventing identity theft during a reception in Albany, N.Y., attended by credit union representatives and legislators.
William J. Mellin, president/CEO, Credit Union Association of New York, talks with Mindy Bockstein, chairman and executive director of the New York State Consumer Protection Board, about the New York Credit Union Foundation’s consumer identity theft and awareness campaign. (Photos provided by the Credit Union Association of New York)
The campaign, “Who are You? Identity Thieves Really Want to Know!” targets New York’s 4.2 million credit union members. It features 15-second PSAs in English and Spanish. The PSAs feature Assemblymen Peter M. Rivera (D-Metropolitan) and James N. Tedisco (R-Capital), and a group of credit union leaders and members. After the reception, the foundation, the New York State Consumer Protection Board and the Credit Union Association of New York, presented an identity theft workshop to New York State legislature. The one-hour session was hosted by Senate Consumer Protection Chair Charles J. Fuschillo Jr. (R-Long-Island) and Assembly Consumer Affairs and Protection Chair Audrey I. Pheffer (D-Metropolitan). Foundation Executive Director Diane LaVigna-Wixted addressed the audience. “Identity theft is not only devastating financially to the victim, it also has negative effects upon the victim’s credit union and all organizations that serve credit unions,” LaVigna-Wixted said. “By working together on this initiative, we present a united front to credit union members and consumers, and promote the credit union difference through financial education.” Topics covered by the campaign include: identity theft: what it is, how it occurs and how to minimize risk; how to protect a Social Security number and computer; how to shop safely online; prevent skimming and recognize scams and frauds; and what to do if an identity is stolen. Other components of the campaign include a webinar to introduce bilingual marketing materials to credit unions; train-the-trainer sessions that have trained 89 individuals from 48 credit unions, eight community organizations and New York legislative offices; and two- to three-minute educational videos with Mindy A. Bockstein, chairman and executive director, New York State Consumer Protection Board. The foundation is providing PSAs and educational videos to credit unions to stream on the Web and in their lobbies. Credit unions also received a sample press release and newsletter article. The campaign is a collaborative project of the foundation, the association of New York and CUNA Mutual Group. Funding for the project comes from a settlement of antitrust claims brought by the Office of the New York State Attorney General and the Federal Trade Commission. Additional funding was provided by Covera Card Solutions and a grant from the National Credit Union Foundation.

NCUF joins Savings for Life Coalition

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WASHINGTON (6/11/08)--The National Credit Union Foundation (NCUF) has joined the Savings for Life Coalition, led by the Aspen Institute, to create “a pathway to financial security for all Americans.” NCUF Executive Director Steve Delfin signed a support letter for the coalition this week. The Savings for Life report by the Aspen Institute Initiative on Financial Security (IFS) outlines the coalition’s approach: “We believe that by truly engaging the best minds in finance, we can find common ground on which to build a new set of savings vehicles that would help more Americans save, invest and own. And at the same time, we can build a vibrant new market of savings product consumers … “What is needed is the right nexus to bring the financial services sector and low- and moderate-income Americans together,” the report continued. “Given the right savings vehicles with the right incentives for both individual savers and the financial services industry, more Americans can access the pathway to greater savings.” “NCUF supports initiatives to improve the present state of savings in America,” Delfin noted. “We understand the implications for families and for our country as a whole. Creating opportunities to help Americans save more and invest in key assets like home ownership and secondary education will build wealth that can be passed on to future generations and contribute to our country’s long-term economic growth. “REAL Solutions, as well as NCUF’s fundraising and grant-making across America, promotes a wide variety of financial education and savings-building programs,” Delfin pointed out about NCUF’s signature program. “We focus primarily on helping working families with low wealth and modest means.” NCUF is collaborating with the Aspen Institute and the Annie E. Casey Foundation on an initiative to help non-prime car buyers steer clear of predatory auto loans. A free “Steer Clear” Auto Lending Summit will take place July 22 from 10 a.m.-2 p.m. EDT at the Credit Union House on Capitol Hill in Washington, D.C. The first 40 participants who RSVP by June 13 will receive a preview of a joint research report, “Credit Unions Help Car Buyers Steer Clear of Predatory Loans.” “By saving car buyers thousands of dollars on reliable transportation to work, we hope to create more discretionary income for these borrowers to save,” Delfin said. “NCUF looks forward to bringing the affordable auto loan initiative to scale, as well as working with IFS to promote a dialog on solutions to America’s savings crisis,” Delfin said. “Together we can achieve transformational philanthropy that will strengthen the financial security of households across America.” Credit union leaders on the IFS Advisory Board include John Tippets, president/CEO, American Airlines FCU, Fort Worth, Texas, and William Bynum, CEO, Hope Community CU, Jackson, Miss.

CU System briefs (06/09/2008)

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* MONTGOMERY, Ala. (6/10/08)--Alabama State Employees CU (ASE CU) is attracting twice as many new members each month since it began offering its Visa ClearCheck card last year (Montgomery Advertiser June 10). Before, about 200 new members joined the $139 million asset credit union each month; now it's about 400 a month, said Barry Mask, marketing director. The debit card won the 2008 Elan Award for the best secure financial card design from the International Card Manufacturers' Association, beating out cards from more than 100 banks and credit unions. ASE CU ordered 8,000 of the card and already has distributed more than 1,000 to new members. The credit union decided to offer the card after focus groups indicated they wanted a clear relationship with their financial institution … * HARRISBURG, Pa. (6/10/08)--Erie, Pa.-based Erie FCU has experienced two cases of fraudulent use of relay services for the hearing impaired, says the Pennsylvania Credit Union Association (PCUA) (Life is a Highway June 10). A relay service contacted the $243 million asset credit union in both cases and attempted to have funds wired-transferred from a member's account. The individuals knew the member's name, account number, Social Security number, address, phone number and mother's maiden name, said PCUA. In one case, the caller did not know the account's password and the credit union avoided a large loss. In the other, a call center representative knew the member was not hearing impaired. The credit union contacted the member while the fraudulent caller was still attempting to gain access to the account. The member placed a password on the account with no loss to the credit union … * RALEIGH, N.C. (6/10/08)--Coastal FCU announced Monday that as of May 31, it had surpassed $2 billion in assets, putting it in the Top 45 largest credit unions in the U.S. The Raleigh-based credit union has added more than $139 million in assets since Jan. 1 and increased membership by 8,000 to 177,000. Growth has been fueled by an influx of new checking account deposits and a spike in new mortgage business. The credit union's rates and commitment to helping people refinance out of adjustable loans led to nearly 100% increase in mortgage loan applications the past year. "When you've been around for more than 40 years, you can achieve this kind of growth," said President/CEO Larry Wilson. He noted that the average community bank is around for about five years before being considered a takeover target. The growth has resulted in a realignment of management responsibilities among staff, effective April 21 … * SAN DIMAS, Calif. (6/10/08)--Financial Service Centers Cooperative Inc. (FSCC) has named Ken Facer, executive vice president of Arrowhead CU, San Bernardino, Calif., as the 2008 Callahan Award winner. The award is presented annually to an individual whose dedication to FSCC has helped expand the reach of shared branching. Shown with Facer is Bonnie Kramer, FSCC executive vice president/chief operating officer, who presented the award on Thursday in Rancho Cucamonga, Calif. (Photo provided by the Financial Service Centers Cooperative Inc.) …

Colorado CUs support fin lit legislation

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DENVER (6/10/08)--The Credit Union Association of Colorado was pleased to see financial literacy legislation (House Bill 08-1168) signed into law by Colorado Gov. Bill Ritter.
Click to view larger image Colorado Gov. Bill Ritter, flanked by credit unions, signs into law House Bill 08-1168, a financial literacy measure supported by the Credit Union Association of Colorado.
The financial literacy legislation passed the Colorado State General Assembly on May 5 and was effective immediately upon the governor’s signature. A group of credit union CEOs and the association government affairs staff attended the signing ceremony held at the State Capitol. The law requires school districts statewide to adopt financial literacy education into their curriculums. It not only heightens awareness for financial literacy in the state's communities, but also presents an opportunity for credit unions to partner with their school districts and offer a turnkey financial literacy program, said the association. “Financial literacy and education have been one of the cornerstones of the credit union movement,” said Timothy Dore, association senior vice president.
Click to view larger image A group of credit union CEOs and the Credit Union Association of Colorado's government affairs team pose before attending a signing ceremony for the state's new financial literacy law. (Photos provided by the Credit Union Association of Colorado)
“We have had success in promoting financial literacy to our credit unions’ membership and the communities we serve, but as a result of the signing of this law, credit unions have a window of extending that success in working with our school districts by providing objective financial education tools," said Dore. "This law is as much about providing financial literacy for the future as it is about providing financial literacy today, and credit unions are happy to have the opportunity to serve our communities in this manner,” Dore noted.

Two new members elected to CUNA Mutual Board

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MADISON, Wis. (6/10/08)--The CUNA Mutual Group board of directors named two new members to its board, replacing two retiring directors.
The new members are: Robert J. Marzec, retired partner from PricewaterhouseCoopers, Minneapolis; and Randy M. Smith, president/CEO, Randolph-Brooks FCU, Live Oak, Texas. Marzec retired from PricewaterhouseCoopers in 2002 as a partner in the assurance and business advisory services practices. He was with the firm for 36 years. Smith has been president/CEO of Randolph-Brooks FCU since 1987. They replace Neil Springer, managing director, Springer and Associates, Wheaton, Ill.; and James L. Bryan Sr., retired president/CEO, Texans CU, Richardson, Texas. Springer and Bryan’s terms ended May 29. Marzec and Smith join board members:
* Eldon R. Arnold, retired president/CEO, CEFCU, Peoria, Ill.; * Loretta M. Burd, president/CEO, Centra CU, Columbus, Ind.; * William B. Eckhardt, president/CEO, Alaska USA FCU, Anchorage, Alaska; * Joseph J. Gasper, retired president/CEO, Nationwide Insurance, Dublin, Ohio; * Bert J. Hash Jr., president/CEO, Municipal Employees CU of Baltimore, Inc., Baltimore, Md.; * Victoria W. Miller, retired executive vice president and chief financial officer, Turner Broadcasting System, Inc., Atlanta, Ga.; * C. Alan Peppers, president/CEO, Westerra CU, Denver, Colo.; * Farouk D.G. Wang, director, buildings and grounds management, University of Hawaii, Honolulu, Hawaii; * Larry T. Wilson, president/CEO, Coastal FCU, Raleigh, N.C.; and * James W. Zilinski, retired chairman, president/CEO, Berkshire Life Insurance Company of America, Pittsfield, Mass.

Report Violent and property crimes declined in 07

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WASHINGTON (6/10/08)--The U.S. experienced a 1.4% decrease in the number of violent crimes--including robberies--and a 2.1% decline in the number of property crimes committed in 2007, according to the Federal Bureau of Investigation (FBI). Robberies were down 1.2% from 2006 robberies, according to the FBI's Preliminary Annual Uniform Crime Report for 2007, released Monday. All four of the violent offense categories declined nationwide from 2006. Forcible rape dropped 4.3%; murder and non-negligent manslaughter decreased 2.7%; and robbery and aggravated assaults each declined 1.2%. Cities with populations of 250,000 to 499,999 saw the most decline in violent crimes: 3.9%. They also saw the largest decrease in robberies--3%. The nation's largest cities, with one million or more in population experienced 2.9% fewer robberies than in 2006. However, violent crime in non-metropolitan counties rose 1.8% while metro counties decreased 1.7%. Murder and non-negligent manslaughter decreased 9.8% in cities of one million or more population; those crimes increased 3.7% in cities with 50,000 to 99,999 in population. Three of the nation's four regions saw violent crimes drop. However, in the South, it rose 1.7% during 2007 over 2006 data. Property crimes dropped in all city categories, with the greatest decrease--4.2%--in cities with 250,000 to 499,999 inhabitants. Motor vehicle thefts declined in all population groups. For more data, use the resource links.

First Basin member seeks regulator intervention

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ODESSA, Texas (6/10/08)--A member of First Basin CU has sent a letter to the commissioner of the Texas Credit Union Department, requesting that a state examiner investigate the April annual meeting of the credit union in which three incumbent directors’ were re-elected. The commissioner also is being asked to investigate the credit union’s earlier attempt to convert to a mutual savings bank. The five-page letter to Commissioner Harold Feeney also was sent to Texas Gov. Rick Perry, Texas U.S. senators, several state legislators and the National Credit Union Administration, among others. In her letter, Karen J. Howard-Winters outlines several points in her complaint against CEO Shem Culpepper and the board of directors of the $115 million asset, Odessa, Texas-based credit union. She alleged that they:
* Withheld important information regarding the election on the meeting notice postcard; * Did not allow conversion opponents to distribute documents outlining their concerns; * Did not allow the opponents to speak during the meeting or to refute claims made that they were influenced by an outside organization formed as a resource to help small credit unions protect themselves against predatory leadership aimed at insider enrichment; * Appeared to be “stacking the deck” with votes from employees and their families; * Spent First Basin funds for a parliamentary attorney who did not contribute to the fairness of the election; and * Spent First Basin [funds] to hire a firm already on the payroll and not a neutral third-party, to count ballots.
The day before First Basin’s annual meeting, the group opposed to the earlier conversion attempt petitioned the courts, seeking depositions from key officials of the credit union (News Now April 15). The depositions related to a potential claim of defamation and breach of fiduciary responsibilities, said the court document. However, a suit was not anticipated at that time. The group announced at a press conference at the Ector County Courthouse that it filed the petition because the credit union had spent roughly $500,000 “of member-owned funds trying to convert” the credit union to a mutual savings bank earlier this year. In an April 8 letter, The Texas Credit Union Department responded that it did not believe it would be appropriate at that time “to insert itself into the credit union’s election process.” The letter, written by Feeney, continued: “Dispute resolution involving an election process is a specialized field. People in this type of dispute resolution generally have undergone extensive training, and depending on the dispute in question, have experience in the field. Examiners are experts in their field, but have not undergone training in dispute training. “While the department declines to send an examiner to observe the proceedings of the upcoming meeting, the department will continue to monitor this situation and will take appropriate action should it be determined necessary,” the letter added. A call to First Basin was not returned to News Now by press time. For more information, use the links.

Study IDs eight underbanked consumer segments

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CHICAGO (6/10/08)--A new study defines eight underbanked consumer segments and reports on their preferences and attitudes about financial services. The Chicago-based Center for Financial Services Innovation (CFSI) released its initial findings at the third Annual Underbanked Financial Services Forum, which continues through today in Miami. The eight underbanked consumer segments include:
* Cash is King: This group includes consumers who are most likely to rely on cash and least likely to have or have had checking or savings accounts. They earn lower household incomes and are more likely struggling to make ends meet. They are highly unlikely to make financial transactions in a bank or credit union. * The Next Wave: This group tries to cover its needs and hopes to reach financial goals like owning a home. It's more likely to make financial transactions at non-banks, less likely to have checking or savings accounts, and cash still plays a key role. They are motivated to save money and are interested in earning interest. * The Strivers: Members of this financially aggressive group take an active role in money management, use checking/savings accounts actively and make many financial transactions. They like checking accounts so they can keep track of their spending and it makes it easier to pay bills while savings accounts are seen as keeping their money secure. More than half have checking accounts. However, some do not; among the reason they cite are concerns about personal information. * Middle of the Road: They also actively manage money, with nearly 70% having a checking account and 60% a savings account. They hold these accounts to facilitate paying bills and make purchases easier. They are less likely to come from families who have banked. The majority do bank and those that do most likely make their financial transactions in a stand along bank or credit unions. They prefer this to do what they need to quickly and the employees are most friendly and helpful. * My Way: This group's members are more likely than other groups to hold a checking and saving account. They enjoy the ease of paying bills and making purchases with checks, and indicate that earning interest is a key reason for their savings account. They make frequent bank and non-bank transactions at various places, including convenience stores. They want transactions completed quickly, conveniently and safely. They don’t want hidden fees or high minimum balances. * The Savers: Saving money is their key reason to have banking accounts. About half hold a checking and/or savings account. Keeping money secure is another key reason for these accounts. Savers who do not have an account cite the security of their personal information as their No. 1 concern. They make more frequent transactions at non-bank locations such as supermarkets, convenience stores, and discount/dollar stores. They look for access to information on products and services--either through classes or brochures. They are less likely to borrow money. Keeping themselves and their spending in check is key. * Almost There: This group's members are more likely to use traditional financial institutions, through a checking account. More than 60% of the group has checking accounts to make bill paying easier and to track their spending. A smaller portion has savings accounts. They are more comfortable making transactions in a bank or credit union than non-banks. They rate their banking experience more positively than the average adult and are likely to keep returning. They prefer banks or credit unions that are contained within a store rather than stand alone buildings. * Borrowers: This group borrows money frequently and for a variety of reasons. They have student loans, personal loans, lines of credit, home equity loans, payday loans, auto loans--all with higher rates than the average adult. This group is more than twice as likely to have borrowed money in the past year. The amounts are lower--under $1,000--but they are more likely to borrow from their bank than family or a friend. Borrowers make above-average transactions at a variety or places--banks/credit unions, supermarkets, convenience stores, drug stores and super centers. Seventy percent have a checking account; nearly 60% have a savings account.
The study linked survey respondents to their credit scores to better understand the credit profiles of the underbanked. Twenty-six percent have a prime credit score, 32% are considered subprime, and 42% had thin or no credit file. Consumers' perceptions of their credit profile largely mirrored their actual profile, the study revealed. The study was co-sponsored by CFSI, Citi, Fidelity National Information Services, H&R Block and MasterCard, and was conducted by Experian Consumer Research. It collected information nationwide from nearly 3,000 unbanked and underbanked consumers with a median household income of $26,390. For more information on the market segments, use the resource link.

Nominations open for Lending in Excellence awards

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MADISON, Wis. (6/10/08)--Nominations are being accepted for the ninth annual Excellence in Lending Awards, which recognize outstanding lending results and practices by credit unions. The deadline for submitting applications is Aug. 8. The awards identify and share examples of lending excellence within the credit union movement by recognizing individual credit unions for their ability to serve members while sustaining sound financial performance. Credit unions demonstrating an ability to meet their members’ needs through innovation are excellent award candidates, said the awards sponsors, CUNA Mutual Group and CUNA Lending Council. Credit unions may be nominated for the 2008 award in several categories:
* Consumer Lending Excellence Award: two categories--assets under $250 million and assets greater than $250 million; * Mortgage Lending Excellence Award: two categories--assets under $250 million and assets greater than $250 million; * Low/Modest Means Excellence Award: Any asset level; and * Business Lending Excellence Award: Any asset level.
For more information, use the link. Awards will be presented at the CUNA Lending Council annual conference Nov. 2-5, in Orlando, Fla. Airfare, hotel and conference registration for one representative of each winning credit union is included with the award. CUNA Mutual and the CUNA Lending Council established the Excellence in Lending Awards in 2000.

Community charters help Georgia CUs grow says article

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ATLANTA (6/10/08)--Community charters are helping Georgia's credit unions withstand the ups and downs of serving members in today's economy, according to an article in The Atlanta Journal-Constitution published on Sunday. The article cites two examples in Atlanta: Delta Community CU, the largest credit union in the state with $2.597 billion in assets, and Georgia's Own CU, with $1.109 billion in assets. Both credit unions switched from employer-focused operations to community-based models. Mike Mercer, CEO of Georgia Credit Union Affiliates, told the newspaper that despite recent stalled membership growth in the state, credit unions there will grow rapidly over the next few years as credit unions boost investments in new branches. Many of the branches are in areas where the credit unions already have members. The article reported statistics from the Credit Union National Association: About 18% of the state's residents are credit union members, compared with 29% nationwide. In some states, at least 40% of the population is a credit union member. There's room to grow, Mercer told the newspaper. The article reported that bankers don't like the community charter, but the credit unions noted that they have to diversify to survive and are just trying to improve services for their members by opening branches in members' neighborhoods. "We're not growing for growth's sake," Rick Foley, president/CEO of Delta Community CU, told the newspaper. For the full article, use the resource link.

What Americans know about their finances--not much

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SILVER SPRING, Md. (6/10/08)--Credit unions have an opportunity to help those struggling to pay their bills and mortgages on time, with a recent survey indicating that the majority of Americans don’t know how to handle their finances. The 2008 Financial Literacy survey, by the National Foundation for Credit Counseling and MSN Money, indicates that one in 10 Americans with a mortgage, or 10 million adults, reported being late or missing a mortgage payment in the last year. One quarter of Americans also say they do not know enough about owning a home to consider buying one, the survey said. Other highlights of the survey:
* Roughly 15 million adults receive calls from collectors or are considering filing for bankruptcy. Only two in 10 keep track of their spending--regardless of gender, age, or income; * Higher income households and older Americans are more likely to stay on top of their bills. Whites and Latinos are more likely to pay their bills on time and stay clear of collections than blacks, and 59% of young adults in Generation Y pay their bills on time each month; * The majority of the public does not have sufficient emergency funds, defined as three to six months’ income saved. More than 76 million adults say they do not have retirement savings; and * One-quarter of Americans expect their income to outpace inflation. More than half of Americans believe their income will shrink or not keep pace with inflation. The worry is the greatest among Americans in the Midwest at 70%.

CUs step up motorcycle loans in gas crisis

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RANTOUL, Ill. (6/9/08)--With prices for gasoline in the U.S. skyrocketing, a number of credit unions are looking to step up their loan promotions for fuel-efficient motorcycles and scooters. Mike Daugherty, president, Community Plus FCU, Rantoul, Ill., practices what he preaches by riding his scooter to work every day. “I bought it last year, and it is not often that you do get to do something that is practical, but fun as well,” he told News Now. The $12.1 million asset credit union has been offering loans on motorcycles and scooters “forever,” he said. “Last summer, we had a hot-pink scooter in our lobby for a promotion, but it didn’t result in a lot of loans though,” Daugherty said. So far this year, Community Plus has not seen any substantial increase in motorcycle or scooter loans. Daugherty attributes this to the fact that many people in town drive to a larger metropolitan area--Champaign-Urbana, about 15 miles away--for work, which is more practical for a car than a motorcycle or scooter. However, Community Plus is hoping to increase loans in this area. “We are planning a promotion but we haven’t work out the details yet,” Daugherty explained. “We opened a branch by a motorcycle store that sells mostly Harleys. And although we don’t do indirect [loans], we will work with the store if it sends people over. We’ll offer loans to them and do the paperwork.” Although ultra-high gas prices have negatively impacted the big three U.S. automakers, many small businesses and consumers who drive a car, they have been a plus for scooter sales (LoHud.com May 18). In the first quarter of 2008, brand name scooters, including Honda, Suzuki, Yamaha and Vespa, went up 24%, according to Mike Mount, Motorcycle Industry Council trade group spokesman. Fuel prices definitely seem to be the driving force behind the ongoing upward-spiraling scooter sales, based on anecdotal evidence, Mount added. The Credit Union National Association’s CU360 online research and advice portal for credit union executives has an article on credit unions offering scooter loans, as rising gas prices boost sales of smaller vehicles. Two credit unions are mentioned for their loan promotions in this area. The article also identifies the pros and cons of scooter loans. For more information, use the link.

CU System briefs (06/06/2008)

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* WASHINGTON (6/9/08)--The deadline is Friday for registering for “How You Can Help Car Buyers Steer Clear of Predatory Loans,” an auto lending summit sponsored by the National Credit Union Foundation (NCUF). The event will take place July 22 at Credit Union House on Capitol Hill in Washington, D.C. and is limited to 40 executives. Best practices in credit union auto lending to non-prime borrowers will be discussed. For more information, contact Lois Kitsch, NCUF REAL Solutions program director at lkitsch@ncuf.coop ... * BOSTON (6/9/08)--Telephone Workers’ CU, Boston, is changing its name to Liberty Bay CU. The catalyst for the name change was a change in the credit union’s charter, which expands membership eligibility to include anyone who lives, works, or attends school in the Boston area. Liberty Bay’s downtown Boston and Braintree branches will relocate. Liberty Bay has $529 million in assets ... * SYRACUSE, N.Y. (6/9/08)--Empower FCU, Syracuse, N.Y., has merged with Fulton, N.Y.-based Nestegg FCU. The relationship presents opportunity for both credit unions’ members, said Jim Reynolds, Empower vice president of communications. Fulton members had wanted branches on both sides of the city, and the merger will fulfill that need, he said. The combined credit union will keep the Empower FCU name (The Post Standard/Herald-Journal May 29) ... * WINSTON-SALEM, N.C. (6/9/08)--Piedmont Aviation President/CEO Judy Tharp is featured on the June cover of Forsyth Woman Magazine, a monthly publication distributed in the Triad. She is featured in an article, "One Woman's Leadership Journey," which highlights her career in credit unions since 1979, when she helped start Cape Fear Employees CU in Wilmington. Tharp discusses the credit union movement and her passion to promote it to as many people as possible. The article highlights her commitment to further credit union progression to more people and the value credit unions provide consumers. (Photo provided by the North Carolina Credit Union League) … * RALEIGH, N.C. (6/9/08)--Coastal FCU has donated $10,000 to the National Veterans Freedom Park Foundation campaign to build a 12-acre site in Cary, N.C., honoring the sacrifices of American servicemen. The park will ensure that their firsthand accounts of history will be preserved. The project's centerpiece will be a 150-foot tall Light of Freedom spire. The location also will house a 25,000 sq. ft. education center, with classroom, auditorium, art gallery and other memorabilia exhibits. In 1973, a fire at the National Personnel Records center in St. Louis wiped out service records of millions of veterans. The foundation is working to record, restore and preserve those veterans' legacies, and is seeking photos, letters, travel orders, separation documents and more. It also will record veterans' stories … * PORTSMOUTH, N.H. (6/9/08)--Service CU of Portsmouth has increased its support, with a $10,000 donation, for an Air Force memorial to honor state men and women who served in the Air Force (Fosters.com June 4). The donation went to the New Hampshire chapters of the Air Force Sergeants Association and the Air Force Association. It makes the credit union the largest contributor to the memorial with a total contribution of $30,000. It gave $5,000 in February of 2007 and another $15,000 in November. A groundbreaking ceremony at the New Hampshire Veterans Cemetery in Boscawen is scheduled for Nov. 11 … * RANCHO CUCAMONGA, Calif. (6/9/08)--The California and Nevada Credit Union Leagues promoted Melissa Ameluxen to state legislative and regulatory lobbyist from political grassroots development specialist. She succeeds Keri Bailey, who is now the leagues' director of state government affairs. Ameluxen, who will continue to work out of the leagues' Sacramento office, will be responsible for assisting leagues boards and government relations committees in developing league policy on government affairs issues. She also will represent those positions to legislative and regulatory decision-makers in the two states. Prior to joining the league, Ameluxen served as field representative, legislative assistant, and district director for former state Assemblyman Russ Bogh. She was a campaign manager for several state legislators, including Assemblyman Bill Emmerson …

CUs tough stance on ID theft commended in editorial

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MOLINE, Ill. (6/9/08)--Using bogus official-looking e-mails and auto dialers, identity thieves have initiated several scams this year to try to trick IH Mississippi Valley CU’s 85,000 members into disclosing their personal account information. The credit union’s response has been lauded by a local newspaper. The $601.7 million asset, Moline, Ill.-based credit union has immediately responded at least three times this year to thwart the scammers’ attempts (Quad-Cities Times June 6). The newspaper said in an editorial: “IH Mississippi Valley has been an ardent community supporter in addition to a successful credit union. We commend its extensive security and public information efforts to fight this scam head on. And we urge readers to follow the credit union’s advice and contact it and the police if scammers hit again.” The credit union has been targeted with identity theft attempts with a frequency that is frustrating the credit union and its members, Laura Ernzen, IH Mississippi spokesperson, told the paper. A few members have fallen for the scams, although none have endured permanent losses, she said. Federal authorities are investigating the scams, Ernzen added.

Vermont CUs elect directors honor Bergeron

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BURLINGTON, Vt. (6/9/08)--The Association of Vermont Credit Unions (AVCU) elected new officers to its board and honored AVCU President Joe Bergeron during its 61st Annual Meeting May 31. Jim Adorisio, Susan Best and Jeff Morse were re-elected to three-year terms on the board. Officers for this year are:
* Chairman John Benoit, NorthCountry FCU, South Burlington; * Vice-chair Sean Gammon, Members Advantage Community CU, Barre; * Secretary Susan Best, ORLEX Government Employees CU, Newport; and * Treasurer Adorisio, Champlain Valley CU, Essex Junction.
Bergeron was honored by the association for 30 years of service and was presented with a Rado watch. Speakers at the meeting included Dennis Dollar, former National Credit Union Administration board chairman and principal partner of Dollar and Associates; Mark Sievewright, corporate senior vice president at Fiserv; and Tom Glatt, CEO of Continental FCU, El Segundo, Calif.
Joe Bergeron (left), president of the Association of Vermont Credit Unions (AVCU), receives a Rado watch from John Benoit, AVCU board chairman, to honor Bergeron's 30 years of service.
From left: Jim Adorisio, Susan Best and Jeff Morse were re-elected to three-year terms on the Association of Vermont Credit Unions board of directors at its annual meeting May 31. (Photos provided by the Association of Vermont Credit Unions)

Membership Growth Series Local Government FCU

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RALEIGH, N.C. (6/9/08)--Local Government FCU (LGFCU) grew its membership 7% from 2006 to 2007, and it attributes its success to a five-fold growth strategy. LGFCU, located in Raleigh, has $736 million in assets and serves the North Carolina local government community, including local government employees, elected officials, appointed persons and volunteers. The credit union self-limits its field of membership to local government. “We believe this contributes to the strength of LGFCU,” Maurice Smith, LGFCU president told News Now. “Our singular focus on local government gives us powerful credentials when making a case to local government officials. We can warrant that our concentration allows us to better understand our membership.” A substantial factor in LGFCU’s growth is its partnership with State Employees CU (SECU) in Raleigh, Smith said. LGFCU outsources its branch operations through SECU, which has 215 branches in North Carolina. Members of LGFCU can visit any SECU branch for service. LGFCU’s computer systems are synchronized with SECU’s so the tellers at each branch can conduct transactions seamlessly, regardless of the member’s credit union, Smith noted. “There’s nothing like having a local facility,” he said. Other parts of LGFCU’s five-fold strategy include:
* Creating close relationships with the leaders of groups in its field of membership. LGFCU has hired member development officers as traveling relationship managers to visit employers at their locations. “The familiarity that our representatives develop helps keep the welcome mat out for the credit union and thwart competitors’ efforts to undermine our connections,” Smith said; * Partnering with corporate entities where members work, which “allows LGFCU to be thought of as more than an employee benefit,” Smith said. The credit union offers payroll deduction, health savings accounts, direct deposit and commercial lending, he added; * Approaching potential members, such as those whose relatives are members of the credit union; and * Being “fanatical” about the LGFCU brand. “We recognize that members are inundated with marketing messages every day. In order for our message to stand out, we must make professional, consistent and relevant points in our communications. We hope members feel comfortable with our approach and suggest that others join,” Smith said.
This is the third 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. Like many credit unions, LGFCU is shifting its growth strategy to target younger generations. Two months ago, the credit union launched a youth advisory council with volunteer youth who share their perspective on LGFCU’s financial services and product ideas. “The purpose is to reach out and understand the younger generation,” Smith said. The volunteers are located throughout the state and don’t meet face-to-face. They meet electronically, through text messaging, the Internet and over the phone. “I’m so impressed with the young folks,” Smith said. About 12% of the credit union’s membership is under 18 years, he added. LGFCU has 18 regional advisory councils that it uses to gain feedback and promote outreach. The councils have been around since the late 1980s and involve about 250 volunteers. The credit union recently hired an employee to oversee LGFCU’s volunteer force, Smith added. LGFCU regularly tweaks the features of its products and services. “Our mortgage loans do not require private mortgage insurance no matter the loan to value,” Smith said. The credit union does not offer risk-based loan pricing, and it keeps fees to a minimum, he added. The credit union also emphasizes the value of a volunteer board, the transparency of democratic voting, the accountability of a member-led loan review committee and a commitment to being responsive to members’ concerns. “Compared to the for-profit world, we believe these features are unique,” Smith said. LGFCU doesn’t want to grow just to claim market share, Smith said. The credit union grows because of philosophical reasons. “We believe that we offer value to membership. And if we believe we offer value, it’s our duty to expose as many people as we can to the credit union. “If we want to grow 500% a year, so be it,” he said. “But if I have anything that slows growth, such as regulatory requirements, I have to ration resources. . . but we are hopeful that the regulatory climate will improve, and growth will be encouraged and rewarded.” Anyone who wants to contact the CUNA Membership Growth Task Force can e-mail the account established for this purpose at cunamgtf@cuna.coop.

California DFI announces approval of five mergers

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SACRAMENTO, Calif. (6/9/08)--California Commissioner of Financial Institutions William S. Haraf announced the state credit union regulator has approved five mergers of credit unions in the state. Approvals were for:
* Monterey Columbia FCU, Monterey, merging with and into Monterey County Employees CU, Salinas, effected May 31. * First Future CU, San Diego, merging with and into California Coast CU, San Diego, approved May 1. * Church/Co-op CU, Sacramento, merging with and into The Golden 1 CU, Sacramento, approved April 29. * California Preferred CU, San Francisco, merging with and into Redwood CU, Santa Rose, approved Feb. 5. A press release from Redwood noted the merger was effective June 1. The combined credit union will serve nearly 143,000 members with total assets of nearly $1.8 billion. * Arrow CU, San Leandro, merging with and into Spectrum FCU, San Franciso, approved April 7.

W. Va. league responds to citys intent to tax CUs

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PARKERSBURG and CHARLESTON, W.Va. (6/9/08)--The West Virginia Credit Union League has written a letter to city officials of Charleston, W. Va., warning that the city's intent to tax credit unions would violate both state code and the Federal Credit Union Act. The league learned through a third party that the city of Charleston intended to propose a business and occupation (B&O) tax on earnings of credit unions as part of the state's Municipal Home Rule Pilot Program. State legislation had given five cities permission as part of the project to find new ways to tax locally. Charleston is the first city to apply, Rich Schaffer, senior vice president of the league, told News Now, noting city officials "may think they may have more leeway than the law allows." The Home Rule Commission approved the city's plans, but the matter has not gone before the City Council yet. League President Kenneth R. Watts, in a letter sent May 30 to City Manager David D. Molgaard and other city officials, outlined why taxing credit unions would be a violation of the state and federal code. "As not-for-profit financial cooperatives, credit unions are exempt from taxation at both the federal level (12 USC Sec. 1768) as well as the state level (WV Code Sec 31C-2-8)," Watts wrote. "This exemption applies to any tax on capital, reserves, surpluses, income, or shares. Both citings are very specific statutory exemptions which I hope will sufficiently eliminate credit unions from any future consideration regarding sources of potential tax revenue," Watts wrote. Watts also clarified a statement in city documents about "unrestricted 'full service' credit unions." "It would seem you feel credit unions are not 'restricted' or perhaps not regulated," Watts wrote, adding that credit unions in the state are regulated by the National Credit Union Administration and the state's Division of Banking, and that credit unions must comply with all applicable consumer laws and regulations that apply to other financial institutions except the Community Reinvestment Act. "It appears that you feel credit unions should be subject to B&O taxes due to their ability to offer an array of services and to serve communities rather than a 'particular business or organization.' Watt wrote. "Since their inception in the U.S. in 1907, credit unions have always had multiple ways to serve their member/owners. While a common way was to have an occupational common bond, credit unions could also be organized to serve anyone within a specified community," Watts explained. He cited as examples: the first credit union in the U.S., which served a parish in Manchester, N.H., and the first credit unions formed ever--in Germany in the mid 1800s. "Both the U.S. Congress and the West Virginia Legislature have deemed credit unions worthy of a tax exemption due to their structure, not based upon the services they provide," he emphasized before outlining the not-for-profit financial cooperative, democratically controlled and governed by unpaid volunteers. He noted the restrictions credit unions have in ways they can raise capital. Watts offered to meet with city officials for a further discussion. The league's attorney has also contacted the city's attorney as a professional courtesy. Schaffer told News Now Friday the league had hoped to have a response by then, and added the league would monitor the situation for further action.

CUNA Mutual 401k program expands to SEGs business

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MADISON, Wis. (6/9/08)--CUNA Mutual Group is expanding its 401(k) retirement program beyond credit unions to include select employee groups (SEGs), business members and other local businesses. The expansion means credit unions with a business services strategy can enter the institutional retirement plan market, said CUNA Mutual President/CEO Jeff Post. “This is much more than just offering a new product. It’s about helping credit unions develop a new business model that can provide them with sustainable growth in income and membership for many years,” Post said. Many credit unions are excellent at helping individual members prepare for retirement through certificates of deposit, mutual funds and annuities. It's a natural progression for them to also help members with their "institutional" retirement plans at work, said Kevin Thompson, CUNA Mutual vice president of asset accumulation products. The expanded 401(k) sales program is already in place at more than 60 credit unions nationwide. It targets credit unions that already have a financial advisor serving members’ retirement and investment needs. “More than 97% of all 401(k) plans in the industry are sold through an advisor or broker, which is why it makes sense to build resources and a distribution channel based on an advisory model,” Thompson said. Thompson said offering a 401(k) program as part of a business services strategy can help credit unions:
* Attract and retain members (including younger ones); * Generate significant and ongoing fee income from plan sales; * Attract 401(k) rollovers and individual rollovers from participants throughout their lifetime as they change jobs or retire; * Strengthen current relationships with SEGs and business members; * Increase cross-selling opportunities for credit union products; * Increase retirement expertise awareness within the community; and * Remain relevant to baby boomers while helping them save more for retirement.
CUNA Mutual has 60% of the 401(k) marketplace in credit unions--about 4,500 plans and 125,000 plan participants. “We’ve built an experienced wholesaling team to help financial advisors sell plans through strategic marketing programs, training, sales support and face-to-face client meetings,” Thompson said. To kick off the expanded program, CUNA Mutual hosted about 60 financial advisors June 2-4 at its Retirement Plan Services Symposium in Boston. CUNA Mutual is seeking to acquire businesses in the 401(k) provider space and has hired an investment banker to find such opportunities, Thompson said.

Wisconsin CUs prepare to assist GM employees

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JANESVILLE, Wis. (6/6/08)--With the recent announcement that General Motors is closing its assembly plant in Janesville, Wis., some area credit unions are preparing to assist the roughly 2,600 displaced workers. Blackhawk Community CU (BCCU), a $288 million asset Janesville credit union, counts many General Motors employees and retirees among its members. It has five branches, three of them in the city (The Janesville Gazette June 5). BCCU is considering ideas to offer new products and services to help displaced workers, Frank Beres, BCCU marketing director, told the newspaper. “There are a lot of ideas being kicked around right now,” Beres told News Now. “The thing we need to keep in mind is that the plant is not closing tomorrow. It will take about two years for it to shut down, although some General Motors suppliers are already facing layoffs.” BCCU is looking at instituting financial checkups in which members come in to see where they stand financially right now, such as with their net worth situation, he explained. “In the short term, for the members who are slated to be laid off, we would provide them with budget tips, loan consolidations, and assist them in making decisions now that will help them in the future,” Beres concluded. Although it is not doing anything specifically geared to the GM workers, the Janesville branch of First American CU, did send out a letter to affected members when the first layoffs were announced, Tracy Blaske, First American CEO, told News Now. First American is a $253.3 million asset, Beloit, Wis.-based credit union. “We just told them, ‘We are here,’” Blaske said. “We review financial situations on a case-by-case basis, and tell members to come in [if they are having financial difficulties]. We don’t have a lot of United Auto Workers as members. We have about 150 total members from General Motors and ancillary companies. “We are anticipating an impact from the layoffs. We will do deferrals on payments and refinancings on loans on an individual basis,” she concluded.

National media CUs dress policy reveals gen differences

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WICHITA, Kan. (6/6/08)--Mid-American CU, Wichita, Kan., last week lifted its pantyhose dress code requirement--garnering some attention from The Wall Street Journal and Good Morning America in the process. The Wall Street Journal published an article yesterday about the credit union’s decision to make wearing hose optional.Good Morning America is scheduled to visit the credit union today, Mid American President Jim Holt told News Now. Holt, 58, lifted the hose requirement after encouragement from his assistant, Kristen Spear. Spear, 28, works in human resources and heads the credit union’s employee committee. Spear believes in looking professional, and her philosophy is “dress for the day.” But she agreed with some employees who told her that they shouldn’t have to wear hose, as the dress code requires. After contacting 17 area financial institutions, Spear found that 71% of credit unions didn’t require their female employees to wear hose with slacks. About 57% didn’t require hose with skirts, she told News Now. The credit union wasn’t completely convinced that it should lift the requirement, so Spear e-mailed a local newspaper asking for a story. Holt e-mailed Wall Street Journal reporter Christine Brinkley, who published an article about women’s dress in the workplace. Brinkley was interested in the topic and interviewed Mid American. After the interview, and Spear’s research, Holt decided to end the hose requirement. The pantyhose issue is definitely related to generational differences, Spear said. While one young employee told her she didn’t own a pair of hose, members of older generations thought hose should be worn, she said. Spear noted that older generations “are realizing that hose are awkward at professional events.” She referenced the Journal article, which said that Kathy Garland, 54, chair of the National Association of Women Business Owners in Dallas, recently threw out a bag full of hose. A few years ago, Garland noticed that she was the only one wearing hose at a fundraiser, the newspaper said. Before the pantyhose issue, Mid American hadn’t updated its dress code in three years. Now, it plans to review the code annually, Holt said. Fashion changes throughout the decades, he said. At one time, men wore leisure suits, double-breasted jackets and other business attire that is no longer worn, Holt noted. Now that the hose requirement is gone, employees have begun making other requests--like being allowed to wear sandals, Spear said. Mid American wants its employees looking professional. But the credit union also has fun with the dress code, Holt said. During the NCAA basketball Final Four tournament, employees were allowed to wear clothing with their favorite team’s colors, and jeans. In the fall, the credit union also will host days where employees can wear football jerseys to support their favorite teams on game days, he added.

Ohio CU ops modernization bill headed to governor

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DUBLIN, Ohio (6/6/08)--A bill that would modernize Ohio's credit unions with amendments on operations, administration and governance is on its way for signature by Gov. Ted Strickland. Senate Bill 247 includes a number of amendments, according to the Ohio Credit Union League (eLumination Newsletter June 4). It:
* Eliminates written ballot approval every time a ballot is necessary, provided it meets established guidelines; * Authorizes no board of directors election if candidates are less than equal to positions and does not require consent or acclimation; * Reviews appointment for the Ohio Credit Union Council, which would be based on asset size (one member from a credit union with less than $35 million; another from a credit union of less than $50 million); * Clarifies joint account holder deposits payable on death; * Sets forth conditions for safes, safe deposit boxes and other secure receptacles and addresses the use of safe deposit boxes by minors; * Establishes record retention time periods and provides additional flexibility for merging with another credit union, and establishes retention time lines to limit liability if documents are destroyed; * Sets forth requirements for storing records electronically and the use these documents, which is same as the Banking Code; * Addresses merger requirements, allowing additional flexibility and structure and providing guidelines for waiver of membership vote; and establishes a required vote of a majority, not 2/3, vote during a membership vote; * Changes language regarding letters of credit by credit unions for agricultural commodity handlers from "bank" to "financial institutions."
"This bill is a strong step toward better enabling credit unions to have the flexibility and ability to operate more efficiently," said league General Counsel John Kozlowski in a press release. The bill will become effective 90 days after the governor's signature.

CU System briefs (06/05/2008)

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* FLINT, Mich. (6/6/08)--Security FCU, Flint, Mich., and Lapeer County (Mich.) Community CU announced Wednesday they plan to merge. The new credit union will be called Security CU. Terry Pierce, president/CEO of Security FCU, will serve as president/CEO of the combined credit union, which will be headquartered in Flint, and have assets of about $350 million. The merger will not cause job losses or office closings. Approval by regulators is expected in September. Troy Garvin, president/CEO of Lapeer, said that by merging, the credit unions will gain efficiencies and cost leveraged into member-focused products ... * SAN DIMAS, Calif. (6/6/08)--Donna Bland, Golden 1 CU senior vice president and chief financial officer, was appointed to a one-year term on Western Corporate FCU's (WesCorp) Supervisory Committee. She joins Darren Williams, Wescom CU CEO, and David Roughton, SAFE CU executive vice president and chief operating officer. Bland fills a seat vacated by Diana Dykstra, president/CEO of San Francisco Fire CU, who was elected to WesCorp’s board of directors ... * DENVER (6/6/08)--Kerry Spradling has been appointed as president/CEO at White Crown FCU, Denver, announced credit union board Chairman Tom Ferguson. Spradling has worked in the credit union industry for 17 years in top positions, said the credit union. His experience in lending and sustaining a sales and service culture will help shape the credit union's strategic direction. White Crown FCU has $47 million in assets and serves employees who work or live in downtown Denver ... * SAN DIEGO (6/6/08)--A member of Point Loma CU (PLCU), Stephen Stamper, threw a ceremonial first pitch at a San Diego Padres game May 9 courtesy of the San Diego-based credit union. “I stood on the pitcher’s mound to absorb the ambience of the occasion, then I moved 10 feet closer to home and managed to get the ball over the plate,” he said. Stamper, of Spring Valley, Calif., has been a PLCU member for 35 years. The first pitch ceremony was part of Family Fireworks night, presented by PLCU, which has worked with the Padres organization for several years. From left are Stamper’s wife, Stamper, and his son. (Photo provided by Point Loma CU) ... * ATLANTA (6/6/08)--Mike Killeen, a 28-year veteran of the Georgia Department of Banking and Finance and a supervisory manager for the second district, has been named new supervisory manager for Georgia's state-chartered credit unions. He succeeds Wayne Orr, who retired June 1 as supervisory manager of credit unions and banks. Orr had been supervisory manager since 1984 and joined the department in 1976 as an examiner … * SAN DIEGO (6/6/08)--An armed man--covered so well with a mask, gloves and hooded jacket that witnesses couldn't tell his age or race--cleaned out the vault and cash drawers at a branch of California Coast CU in San Diego Wednesday. The incident occurred at about 5 p.m. Armed with a pistol, he forced one teller to escort him to all the teller stations and the vault. He wore a Bluetooth earpiece and was heard asking, "Where's the van?" said police. He put the money in a large dark bag and left (Union-Tribune June 5) …

Community development archives now available

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ITHACA, N.Y. (6/6/08)--The archives of Community Development Banking-L (CDB-L) List--an active free ongoing e-mail discussion resource that serves community development practitioners, including credit unions, is available. It was shut down due to a hacking attack in November. The attack was on the archive, not the list itself, Bill Myers, list moderator, told News Now. The archive uses a free bulletin board system, called PHP. “The software hadn’t been updated in years, and known PHP vulnerabilities were exploited on the CDB-L site in an attempt to take over the server,” Myers said. To remedy the problem, the site was brought down. Now the most up-to-date version of the PHP software has been deployed, hosted with an active partner--Governance & Accountability Institute Inc., Myers explained. The list has served community development practitioners since 1994 with no particular emphasis on type or subtype, Myers said. CDB-L has about 3,200 subscribers from a variety of institutions, including credit unions, banks, loan funds, trade associations, regulators, researchers, and government and nonprofit advocates, he added. “Two staple topics are offerings and conferences,” Myers said. “Not unexpectedly, there was an active discussion this spring on housing and the mortgage crisis.”

Washington league wins state-level community service award

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FEDERAL WAY, Wash. (6/5/08)--Four community service projects in 2007 have netted the Washington Credit Union League the Association Community Service Award from the Washington Society of Association Executives (WSAE). WSAE recognized the league's work in projects related to Financial Literacy Month, Shred Day, Biz Kid$ and Preventative Elder Financial Abuse. "Organizing and supporting community service projects that our member credit unions can be involved in is a priority for the Washington Credit Union League," said league President/CEO John Annaloro. "This award is significant because of the wide participation among credit unions from across Washington state," he added. For Financial Literacy Month in April, the league developed a program to encourage youth savings. Participating credit unions would deposit $25 into newly opened youth savings accounts. During the two-week program, credit unions opened more than 1,125 new kids' accounts. In October, the league coordinated a state-wide credit union "Shred Day" in cooperation with the state Attorney General Rob McKenna. Participants included more than 30 credit unions, four credit union chapters, and volunteers from credit unions and the league. They encouraged consumers to bring sensitive documents to their local credit union for free shredding to avoid identity theft. They shredded nearly 73.5 tons of documents. The league also was recognized for its support of and participation in BizKid$, the PBS television show featuring young entrepreneurs teaching fiscal responsibility. The league and its foundation were active in national fundraising efforts and coordinating with the show's producers. Through its award-winning Tomorrow's Leaders Council, the league developed training and model policies credit unions can use to train staff to identify and respond to potential abuse of an elderly person. Tomorrow's Leaders volunteers presented the materials at credit unions throughout the state and to the public at a fraud prevention programs in Pierce and King counties.

CO-OP Networks text-messaging service helps locate ATMs

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RANCHO CUCAMONGA, Calif. (6/5/08)--Credit union members wanting to find the nearest surcharge-free ATM nearest can text their location to a number at CO-OP Network or download a database of ATM locations directly to their personal navigation devices, according to CO-OP Network. The network announced it is doubling the options members have for finding surcharge-free ATMs. Now cardholders can text their location to 692667 (MYCOOP) or download the database as well as use CO-OP's current phone and online ATM locator functions. How does it work? Cardholders text their location--address, intersection or ZIP code--to the MYCOOP number on any mobile phone. In less than one minute, the service replies with the CO-OP Network's surcharge-free ATMs nearest the location. To find additional locations, the user simply replies with "MORE." "One of the biggest misconceptions is that credit unions are inconvenient," said Stan Hollen, president/CEO of CO-OP Financial Services, the network's parent organization. "By offering services such as text messaging and GPS (global positioning system) navigational downloads, credit unions immediately increase their convenience and display more technology know-how than some of the largest banks," he said. Members with a personal navigation device such as Garmin will be able to download the network's ATM database through a link on www.co-opnetwork.org, planned for later this month. Once the database loads, members can receive turn-by-turn directions to drive to the nearest CO-OP Network ATM. The database will be updated monthly.

Michigan governor signs snowmobile registration bill

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LANSING, Mich. (6/5/08)--Michigan Gov. Jennifer Granholm signed into law a secured snowmobile registration bill--House Bill 5085--which was put forward by the Michigan Credit Union League (MCUL). The bill establishes a secured registration system for snowmobiles without any additional costs to snowmobile operators, according to the league’s website. “It will help credit unions and other lenders by requiring that all lien holders of a financed snowmobile be listed on the vehicle’s registration,” said MCUL Executive Vice President Patrick La Pine. “This brings snowmobiles under the same registration system that applies to motor vehicles and boats.” Introduced by State Rep. Jeff Mayes (D-Bay City), H.B. 5085 passed the state House 104-2 on Dec 13. In a 105-1 vote, the Michigan House concurred with the Senate action May 13. The registration system the bill establishes will take effect in 2009, when the secretary of state’s office is scheduled to undergo a computer upgrade.

Missouri DOR ordered to cancel records fee hike

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ST. LOUIS (6/5/08)--A Missouri Circuit Court judge ordered the Missouri Department of Revenue (DOR) to cancel a fee increase for state driver and motor vehicle records. The DOR raised its fees from $1.25 to $7 per record and eliminated bulk discounts on record purchases May 1, according to the Missouri Credit Union Association (MCUA) (CourierNet June 4). MCUA is monitoring the situation. It has been advised by DOR that the fee remains at $7 at the present time, MCUA said. The fee hike proposal prompted Carfax--a company that provides vehicle histories for consumers buying used autos--to threaten to stop serving Missouri customers (News Now May 13). 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 increase would cost Carfax $42 million more than what it pays for data from all 50 states and Canada combined. Several companies that routinely purchase these records sued DOR, saying the agency violated the state’s Sunshine Law. DOR representatives argue that driver and motor-vehicle records are not open records and not covered by the Sunshine Law. Missouri’s Sunshine Law states that “meetings, records, votes, actions, and deliberations of public governmental bodies be open to the public unless otherwise provided by law.” The law sets out the specific instances when a meeting, record or vote may be closed, while stressing these exceptions are to be strictly interpreted to promote the public policy of openness, according to the Missouri Attorney General office website. DOR’s defense was rejected by Cole County Circuit Court Judge Richard Callahan, in a ruling that said the phrase “public records” should include all government records--public and private. He issued a preliminary injunction. On June 20, the Cole County Circuit Court will hear the case again to consider other facts and decide whether to cancel the fee increase permanently. During the 2008 legislative session, the Missouri General Assembly passed a bill that would limit fees to $0.005 per bulk record. However, Gov. Matt Blunt has not signed the bill into law yet, said MCUA.

WOCCU lends a hand in Caribbean co-ops bill passage

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ST. VINCENT and THE GRENADINES (6/5/08)--World Council of Credit Unions (WOCCU) Chairman Melvin Edwards last week joined credit union officials in the Caribbean nation of St. Vincent and the Grenadines to lobby for legislation that would appropriately regulate credit unions.
Melvin Edwards, World Council of Credit Unions chairman, recently lobbied in favor of new legislation with the help of several local credit unions officials to help Caribbean credit unions. From left are: Julian Jack, president of the Caribbean Confederation of Credit Unions; Edwards; St. Vincent and the Grenadines Gov. General Monica Dacon; and St. Vincent Co-operative Credit Union League President Sylvia Sutherland. (Photo provided by the World Council of Credit Unions)
The bill, the Harmonized Cooperative Societies Bill, “will enable credit unions to grow through a more competitive framework based on more clearly defined compliance requirements that preserve credit unions’ distinctive cooperative features,” Edwards said. Edwards, who represents the Caribbean Confederation of Credit Unions (CCCU) on WOCCU’s board, along with CCCU President Julian Jack, and St. Vincent League President Sylvia Sutherland, paid courtesy calls to Gov. General Monica Dacon, Prime Minister Sir Louis Straker and the Honorable Michael Browne, whose oversight includes cooperatives. Government officials were impressed with the influence of credit unions, which serve 85% of the country’s workforce, Edwards said. “Rest assured of the government’s full cooperation in building the credit union movement,” Browne added. “We will continue to build and defend the cooperative philosophy.” The St. Vincent League, which has nine credit unions serving 47,000 members, supports the proposed legislation. The revised law will allow the Department of Cooperatives to regulate at the national level and oversee the entire cooperative sectors. The bill evolved from earlier versions passed into law across Caribbean countries between 1995 and 2001. WOCCU’s Model Law for Credit Unions and its PEARLS Monitoring System, a financial and business planning software, influenced the version of the bill currently before the St. Vincent government. The new version was adjusted in response to a review by East Caribbean Central Bank and several regulators. Legislation to strengthen regulatory oversight of financial cooperatives in St. Vincent and the Grenadines has stalled in the country’s legislature, partly due to for-profit sector efforts to reclassify cooperatives under bank regulatory oversight.

CU System briefs (06/04/2008)

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* HARRISBURG, Pa. (6/5/08)--The Pennsylvania Credit Union Association (PCUA) hosted state Secretary of Banking Steve Kaplan and Paul Wentzel, Kaplan's executive assistant, Tuesday. PCUA President/CEO Jim McCormack noted the visit "gave us the opportunity to show him what the association does on behalf of Pennsylvania's credit unions. He was impressed with the facility and staff." (Life is a Highway June 4). From left are: Rick Myxter, PCUA assistant vice president, credit union development, who explained his work with World Council of Credit Unions and an upcoming trip to Kenya; McCormack; Kaplan; and Wentzel. (Photo provided by the Pennsylvania Credit Union Association) … * MADISON, Wis. (6/5/08)--The National Credit Union Foundation (NCUF) has appointed Josie Collins as resource development and donor relations director. Collins will be responsible for growing the $360 million Community Investment Fund, attracting corporate supporters and individual donors, and managing NCUF's annual public awareness event, the Herb Wegner Memorial Awards. She previously served as council liaison and awards competition coordinator at the Credit Union Executives Society (CUES). Prior to her five years at CUES, Collins analyzed the credit union marketplace at Survey Research Associates in Madison. Her office is based in Madison, where she can be reached at jcollins@ncuf.coop or 800-356-9655, ext. 4397 … * FORT LEONARD WOOD, Mo. (6/5/08)--To show appreciation for members of the U.S. military, Mid Missouri CU purchased more than 2,000 tickets for military families to attend Armed Forces Day at Hammons Field in Springfield, home of the Springfield Cardinals (CourierNet June 4). More than 400 military personnel stationed at Fort Leonard Wood lined the field while a military band, shown here, performed the national anthem. Mid Missouri coordinated with the Missouri National Guard in Springfield to fly a UH-60 Black Hawk helicopter over the stadium afterward. Other credit unions donating tickets included Century, Community Financial, Stationery, St. Louis Community, United Labor and Vantage credit unions. (Photo provided by the Missouri Credit Union Association) … * HARRISBURG, Pa. (6/5/08)--A credit union member who signed up for a secret shopper program on a website became a victim of a secret shopper scam, according to the Pennsylvania Credit Union Association (PCUA) (Life is a Highway June 4). The victim, a member of North East (Pa.) Welch FCU, received a packet instructing the recipient to cash a cashier's check for $3,410 and send a $2,500 money gram to someone in Texas. The check was returned as fraudulent, said PCUA … * NORTHVILLE TOWNSHIP, Mich. (6/5/08)--Timothy W. Benecke has been appointed as president/CEO of Communications Family CU, Saginaw, Mich., according to the Michigan Credit Union League (Michigan Monitor June 2). He will succeed James C. Dahl, who retires on July 1, after 24 years with the credit union. Benecke has 25 years' experience with credit unions in the region, most recently serving as president/CEO for six years of FinancialEdge Community CU, Bay City. He also is a former operations vice president with Dow Chemical Employees CU, Midland …

Loans up savings balances decline in April

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MADISON, Wis. (6/5/08)--Credit union loans outstanding increased 0.9% in April 2008, and 1.8% during the year, a one percentage point increase compared with the same period last year, according to the Credit Union National Association (CUNA) monthly sample of credit unions. “The year-to-date loan growth of 1.8% is a bit stronger than we had expected,” said Bill Hampel, CUNA chief economist.
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This probably is--despite the fact that members are cutting back on borrowing--also because of the weak economy, Hampel explained. Members are doing more of their borrowing at credit unions because other lenders have substantially cut back on lending. There are likely to be more opportunities for credit unions to make good loans, especially mortgage loans, for the rest of the year because of restricted credit supplies from other lenders, he told News Now. “After making sure of the asset/liability management implications, credit unions with sufficient liquidity can meet some of these member demands,” Hampel added. The year-to-date increase in loans also is partly due to fixed-rate first mortgages increasing 7.4%. Adjustable-rate mortgages rose 2.9% during April, followed by other loans (1.6%), fixed-rate first mortgages (1.5%), used-auto loans (1.1%), home equity loans (1%), credit card loans (0.9%), and unsecured personal loans (0.6%). Other mortgages (1.3%) and new-auto loans (0.7%) declined during April.
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Credit union savings balances declined 0.2% in April, but grew 4.8% year-to-date. Money market accounts and one-year certificates increased 1.5% and 0.5%, respectively. Share drafts (2.7%), individual retirement accounts (1.5%), and regular shares (0.9%) decreased during the month. “Savings growth is still running ahead of the weak performance of the previous four years, and CUNA's economists expect 2008 to be a strong year for credit union savings as members cut back spending because of the weak economy,” Hampel said. During the first four months of 2008, money market accounts increased 10%, double the 5% for the same period last year. Credit unions’ loan-to-savings ratio increased to 81% in April from 80% in March. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--declined to 19% in April from 21% in March. Regarding asset quality, credit union 60-plus day delinquencies were 1% in April 2008. The rapid rise in loan delinquency last year, from 0.68% in April to 0.93 in December, has since slowed, Hampel noted, adding “the delinquency rate was essentially unchanged from March to April, rising from 1.00% to 1.01%. “The outlook for 2008 remains difficult for credit unions,” Hampel said. “But, the good news is that credit quality does not seem to be worsening further.” With the increase in assets, the movement’s overall capital-to-asset ratio remains at 11.1%. The total dollar amount of capital is still at $90 billion.

ELLy training awards program adds asset categories

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MADISON, Wis. (6/5/08)--Credit union training programs and trainers will be recognized for their outstanding staff development achievements in two asset categories during this year’s Experience Learning Live (ELLy) Training Awards program, sponsored by the Credit Union National Association (CUNA). The ELLys are the only national awards presented to credit union trainers who perform outstanding work in professional staff development. Beginning this year, awards will be presented in two asset divisions--less than $250 million in assets and $250 million in assets or above--in each of six categories:
* Chi Phi Delta X II Award--Represents the best development of a Credit Union University, and its effect on staff learning and performance, using CUNA’s Center for Professional Development products as a foundation; * Coach Award--Recognizes a trainer who has significantly affected a trainee’s career and life through education, mentoring, and coaching. The entry can be submitted by employees or trainers in honor of a trainer who impacted their own or their co-workers’ lives and careers; * eLearning Award--Demonstrates how technology-based training was incorporated into and enhanced credit union training programs; * Training Champion Award--Singles out senior management staff in a credit union that go beyond the call of duty to support and develop the credit union’s training; * Training Professional of the Year Award--Honors exceptional achievements in performance and learning by a credit union training professional or department; * WOW Award--Recognizes the credit union with the best overall training curriculum or best training event that energizes, empowers and excites participants.
Entries must be received by Aug. 1. Awards will be presented at the 2008 Experience Learning Live conference, held Oct. 26-29 in Tempe, Ariz.

New CUSOs first month nets 1.5 million in student loans

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WASHINGTON (6/5/08)--The Credit Union Student Choice network has approved more than $1.5 million in private student loans since the network launched one month ago. Credit Union Student Choice is a credit union service organization that helps credit unions offer private student loans at a time when major student lenders have left the market. The seven credit unions on the network providing members with cost-effective college financing are:
* Affinity Plus FCU, St. Paul, Minn.; * Digital FCU, Marlborough, Mass.; * NASA FCU, Bowie, Md.; * NuUnion FCU, Lansing, Mich.; * Northwest FCU, Herndon, Va.; * Star One CU, Sunnyvale, Calif.; and * Wright-Patt CU, Fairborn, Ohio.
“We started to see applications flow in immediately and they haven’t stopped,” said Jon Jeffreys, Credit Union Student Choice CEO. “The volume has picked up significantly in the last week alone, as members are becoming aware of their credit union’s new solution. “Some of our first loans were actually from credit union employees who’d heard about the new loan product and were sold on its benefits before marketing had even begun,” he added. Most of the credit unions have little background in student lending. “It shows the tremendous need that exists now; the affinity that consumers have in borrowing from strong, local lenders; and the value credit unions can deliver with this product as more members become aware,” Jeffreys said. The new program launched May 5.

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.

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.

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."

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 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.”

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 …

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.

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.”

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.

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 cunamgtf@cuna.coop

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.

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.

Ohio governor signs payday lending law

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COLUMBUS, Ohio (6/3/08)--A bill that would place new restrictions on payday lending in Ohio was signed by Gov. Ted Strickland Monday. The law would limit borrowers to four short-term loans per year. It also caps annual interest rates at 28%(Associated Press June 2). Payday lenders had charged borrowers $15 for each $100 on a two-week loan--an annual interest rate of 391%, the news service said. “The league continues to impress upon legislators that the mission of credit unions is separate from that of a payday lender,” John Kozlowski, Ohio Credit Union League general counsel, told News Now. “Credit unions have always focused on an overall financial relationship with their members, and the governor and the Ohio General Assembly have been receptive to our mission.”

Study CUs ahead of competitors on mobile banking

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BOSTON (6/3/08)--Mobile banking in financial institutions is still lagging behind the growing rate of mobile phone use in the U.S. But credit unions are leaders in the mobile banking efforts surfacing so far, according to a new study. Of the 260 financial institutions studied, 39 institutions--or 15%--provide mobile banking, noted Mercator Advisory Group Inc.'s report, "U.S. Mobile Banking: Sedate Growth, Disruptive Potential." Mercator is based in Boston (Cardline May 30). The study found that 23% of the largest credit unions have mobile-banking services. That compares with 17% of the largest banks and none of the largest community banks, according to the report. In 2007, roughly two million Americans were mobile-banking subscribers, fewer than the 3.7 million the Mercator Advisory Group had predicted last year. The report's author, George Peabody, noted that last year not enough financial institutions offered mobile banking. But he predicted steady growth of mobile-banking users of 33.1 million by 2012. Poor marketing and lack of consumer awareness about mobile banking may prevent mobile banking from succeeding, Peabody said. Financial institutions aren't promoting their mobile banking on their websites, which would lure Generation Y customers, he said.

WOCCU extends WYCUP Scholarship deadline to June 12

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MADISON, Wis. (6/3/08)--The deadline for nominations for the World Council of Credit Unions' (WOCCU) Young Credit Union People (WYCUP) Scholarship Program has been extended to Thursday, June 12. The WOCCU Scholarship will be awarded to five recipients at the 2008 World Credit Union Conference in Hong Kong. Winners earn an all-expenses-paid trip to the 2009 World Credit Union Conference in Barcelona, Spain. The WYCUP Scholarship Program is part of WOCCU's commitment to ensuring the future sustainability of the international credit union system. It seeks individuals 35 years of age or younger who 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 unique talents at the international level. Credit unions and credit union organizations that are WOCCU members can nominate their next generation of credit union leaders 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 the 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 no later than June 12.
All WYCUP nominees will be formally recognized in Hong Kong and invited to take part in events, including a networking session, organized for participants 35 years of age and younger. Registrants in this age group qualify for a discounted registration fee regardless of whether they compete for the scholarship. For more information, use the link or contact Liliana Tangwall at 608-395-2043 or ltangwall@woccu.org.

Three of four consumers clinging to paper statements

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SAN FRANCISCO (6/3/08)--While many credit unions are turning their operations green and encouraging their members to do the same, old habits die hard. Three out of four consumers still cling to their paper statements. A new report released Monday by Javelin Strategy & Research found that green banking habits have yet to take hold. The San Francisco-based firm noted that if every U.S. household stopped receiving paper bills and statements, they would save 687,000 tons of paper every year--enough to circle Earth 239 times. The report found that consumers aren't aware of how they can make a difference, and financial institutions have yet to find incentives that compel consumers to participate. "Most consumers want to do the right thing, but if the process appears confusing or inconvenient, they simply aren't going to bother changing their habits," said Mark Schwanhausser, research analyst at Javelin Strategy & Research. Of the 13 companies mentioned in the report, five are credit unions: Credit Union One of Oklahoma, Oklahoma City; Sound CU, Tacoma, Wash.; Star One CU, Sunnyvale, Calif.; Technology CU, San Jose, Calif.; and Vancouver City Savings CU, Vancouver, B.C. The Green Banking Report's key findings:
* Three out of four consumers receive paper statements; * Of those surveyed, 34% said they switched to electronic statements to reduce their impact on the environment; * 43% said they are more likely to do business with companies they perceive to be green; * 22% said green initiatives cement the bond they have with their bank; * 60% of "green bankers"--consumers who say environmental impact is "extremely important" in purchasing and banking decisions--are women; and * 64% of "skeptics"--consumers who are "very less likely" to be more loyal to their bank because of its environmental activities--are men.
Availability, accessibility and complexity are the key challenges stalling the adoption of green banking behavior, said Javelin. It advised financial institutions to focus on products and promotions that speak directly to environmentally conscious consumers. These include "green audit" calculators to help consumers compute the environmental impact of their banking behavior, a one-stop paper statement shut-off option for all accounts and green banking marketing campaigns that reward consumers for eco-friendly practices.

E-scan Opportunity in refinancing toxic mortgages

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MADISON, Wis. (6/3/08)--Credit unions should focus on mortgages and other loan products that are more insulated from the economic downturn, according to the Credit Union National Association’s (CUNA) 2008-2009 Credit Union Environmental Scan (E-Scan). The E-scan, which offers issues and trends affecting the financial services industry, is used by credit unions to prepare for strategic planning sessions, budgeting, product development and new initiatives. Top insights from this year’s report are:
* Economy--The economy will continue to present challenges for credit unions as it recovers from a mild but longer-than-normal recession. Negative trends likely in the coming year include rising delinquency and loan losses, falling net-worth ratios and net income, and a weak labor market; * Housing--To address problems in the U.S. housing market, the government must adopt regulatory changes that protect borrowers and maintain a competitive industry, as well as bring back market discipline and transparency; * Lending--Credit union loan growth will slow to 5% in 2008 and 6% in 2009; loan delinquency rates will rise, especially in areas with the biggest housing price corrections. To ensure future loan growth, it’s essential that credit unions do a better job of building relationships with Generations X and Y, and look for opportunities in business, student, and mortgage lending; * Earnings--Credit union return on assets is expected to fall to 0.53% in 2008, as deteriorating credit quality and slower loan growth reduce earnings to the lowest level since 1980. Credit union capital-to-asset ratios are expected to decline from a record high in 2007. Most credit unions have built strong capital cushions over the past decade and should let that cushion protect their credit unions during this temporary decline in net income; * Membership growth--Membership growth was 1.7% in 2007, but factoring out new members who enter fields of membership through the indirect lending channel, membership growth rates appear to be on the decline. About 53% of credit union CEOs say superior service is their most successful strategy for attracting new members and improving the bottom line; * Competition--Credit unions are part of a mature industry whose numbers are shrinking as an aging business model constricts new growth opportunities. Large retail banks and other competitors have immense resources that are far beyond the reach of most credit unions unless they innovate and collaborate; * Collaboration--When surveyed informally, two-thirds of CEOs of large credit unions identified collaboration among credit unions as critical or very important. Credit unions will be well-positioned for the future if they leverage their members’ loyalty and their reputation as consumer advocates and look to their rich cooperative heritage and opportunities for collaboration to reduce costs and to subsidize the price tag of innovation; * Regulation--Although focusing on lending, credit unions’ analysis of all types of third-party vendors before contracting with them and during the life of the contract will be a high priority for National Credit Union Administration examiners in 2008 and beyond; * Legislation--The Treasury Department’s plan to overhaul the financial regulatory system would call for the creation of a “prudential financial regulator” and a new type of charter that would consolidate the national bank, federal savings association, and federal credit union charters. Opposed to the plan, CUNA received assurances from House Financial Services Committee Chairman Barney Frank (D-Mass.) that any proposal to do away with credit unions “will go nowhere”; and * Technology--Financial institutions will increase their technology spending at a slower pace than previous years. Credit unions are committing the greatest percentage of their technology budgets to software needs (26%), followed by hardware (23%), data/voice communication (14%), and online banking (11%).
The E-Scan analysis is divided into key issue areas: competition and collaboration, demographics; economics; marketing; lending; technology; products and services; payment systems; human resources; and legislation and regulation. It covers more than 50 key credit union topics and 125 strategic implications for planning. The E-Scan is available in report, PowerPoint presentation, and DVD for use in planning, presentations and discussions. The PowerPoint presentation contains more than 100 slides that can be mixed and matched to meet specific needs. The 30-minute video provides an overview of the report. New this year is the E-Scan Strategic Planning Kit to help guide credit unions through a step-by-step strategic planning process to achieve actionable short- and long-term goals. In addition to the planning guide and accompanying resources, the kit also includes the DVD and 12 copies of the E-Scan report. For more information, use the resource link.

N.J. CUs help families send Web greetings to soldier dads

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HIGHTSTOWN, New Jersey (6/3/08)--New Jersey credit unions are helping send free online greetings from military children, spouses and families to soldier dads for Father’s Day. The program, Operation Father’s Day Salute, invites families into a recording studio to record a 10-minute greeting June 9-13. The greetings will be sent using the studio’s encoded high-speed Internet connection. The soldiers can view and respond to the greetings through instant text messaging, or access the greetings at a later date. Families can reserve their recording session prior to the event by visiting www.operationbestwishes.com. Operation Father’s Day Salute is sponsored by the New Jersey Credit Union League, with additional support from CU Abstract, CUNA Mutual Group, East Coast Business Lenders, P.W. Campbell and Sprint.

ColoradoWyoming associations in new headquarters

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DENVER (6/3/08)--The Credit Union Associations of Colorado (CUAC) and Wyoming (CUAW) have moved to a new headquarters building in Denver, occupying a fully renovated 1929 historic structure just four blocks from the Colorado Capitol.
The Credit Union Associations of Colorado and Wyoming have moved to a new headquarters building in Denver, occupying a renovated 1929 historic structure just four blocks from the Colorado Capitol. (Photo provided by the Credit Union Associations of Colorado and Wyoming)
The move culminates a multi-year effort by the associations to improve the visibility of the credit union movement. “When I was hired in 2004, the board of directors of the Colorado association put this move high on our agenda, and for obvious reasons,” said John Dill, president/CEO of CUAC/CUAW. “Our old headquarters in Arvada was a great facility when it was opened in 1972, but it no longer addressed two of our critical missions--advocacy and visibility.” The new facility will answer both of those needs while still providing the necessary parking and on-site training at the facility, which credit unions have come to expect from their statewide trade associations, Dill said. The new facility is also “right-sized” for the needs of CUAC/CUAW in the 21st century--containing approximately 23,000 square feet, or roughly half the size of the old facility in Arvada. “When we had functions such as check and item processing and office supplies, we needed that extra room in the suburbs,” Dill said. “In 2008, we need to be close to our elected officials and able to easily brand credit unions as the preferred financial service provider in our two states.” Known as the “Casa Grande” building, the historic 1929, four-story structure reflects an architectural design by Denver architect and master builder Walter H. Simon. The facility was Class C office condos before it was purchased by the credit union group. An old underground parking garage has been renovated and will be used as a state-of-the-art training facility, which will be named “The Sterner Center,” after Bill Sterner, the recently deceased chairman of CUAC. The building is owned by Credit Union Strategic Partners (CUSP), the league service corporation that services both Colorado and Wyoming. The cost of the renovation was paid out of the reserve funds of CUSP. “The associations offered old furniture, shelving, file cabinets and supplies to the credit unions in Colorado and Wyoming, and several smaller ones took advantage of that offer,” said Dill. The old facility has been sold to an investor and will be occupied by a charter school. The associations will plan a grand opening later in the summer, and will host VIPs and other credit union leaders at the facility during the Democratic National Convention in Denver in August.

CU System briefs (06/02/2008)

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* HERNDON, Va. (6/3/08)--With its headquarters decorated in yellow ribbons and American flags, Northwest FCU (NWFCU) employees
Click to view larger image Click for larger view
celebrated the return on May 19 of fellow employee Joshua Speights (shown here) to work after a year-long tour of duty with the Army Reserve in Iraq. Speights was stationed at Baquaba, Iraq Dilyah Province. NWFCU rolled out the red carpet with a large "Welcome Home Joshua" banner hung high on the building as a tribute to Speights and his service. At an employee luncheon, Speights told the group, "I can't thank NWFCU enough for the warm homecoming, and all the care packages and cards while I was away. They made my time away from home a little easier. Knowing that you have a strong support group makes a difference. I am grateful and happy to be home." According to President/CEO Gerrianne "Winky" Burks, "We are proud to have him home and thrilled he is home safely." … * LOS ANGELES and IRWINDALE, Calif. (6/3/08)--The boards of First City CU, Los Angeles, and SCE FCU, El Monte, Calif., announced Friday they have signed a letter of intent to merge the two credit unions. Both credit unions are strong and growing, and have similar asset sizes, complementary membership bases and branch networks, as well as healthy balance sheets, the boards said. The combined credit union will have $785 million in assets and serve 80,000 members in the greater L.A. area. SCE FCU CEO Dennis J. Huber will become CEO of the new combined organization, which will retain the First City name and state charter. All employees of both credit unions will continue employment with the combined credit union. The merger is pending approval of state and federal regulators and SCE FCU's members … * BOWIE, Md. (6/3/08)--The Tire Industry Association (TIA) announced that its members and employees are now eligible to join the $889.1 million asset, Bowie, Md.-based NASA FCU. TIA's members will have access to all the credit union's services, including: competitive rates on deposits and loans, free online bill pay, Visa credit cards with low fixed rates, and account access nationwide at more than 1,900 branches in 43 states as well as surcharge-free ATM access at more than 5,300 7-Eleven store ATMs. TIA members and employees and their immediate family and persons living in the same residence are eligible. TIA represents all segments of the tire industry … * CHAGUANAS, Trinidad & Tobago, (6/3/08)--The government of Trinidad & Tobago has intervened with support for a struggling cooperative, Hindu CU, nearly three years after thousands of members began demanding their deposits back. The credit union paid out about $420 million. Finance Minister Karen Nunez-Tesheira confirmed that the government would assist the credit union. Hindu CU had asked for a $71 million loan that would be collateralized by real estate assets (Trinidad Express June 1) … * ANTIGUA (6/3/08)--Antigua police are questioning two suspects in the kidnapping Sunday night of a credit union manager at gunpoint. She allegedly was bound, gagged and forced into the trunk of her car, then taken to Community First Cooperative CU Monday morning. There the robbers forced her to open the credit union's ATM. The abductors left with an estimated $200,000, police said (Antigua Sun June 2) …

ICU MagazineI names its 2008 CU Hero of the Year

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MADISON, Wis. (6/3/08)--Lynda Milton, CEO of Houston Teamsters FCU, is Credit Union Magazine’s 2008 CU Hero of the Year. She’ll receive her award at (and complimentary registration to) the America’s Credit Union Conference June 29-July 2 in New York City. Nominated for the award by her peers, Milton has spent 41 years saving, serving, and supporting small credit unions. Also honored as credit union heroes were Bill Myers, former CEO of Alternatives FCU, Ithaca, N.Y.; Larry Stapleton, CEO of Southeast FCU, Bristol, Tenn.; and Mendell Thompson, CEO of America’s Christian CU, Glendora, Calif. To nominate a credit union hero, visit creditunionmagazine.com or contact Credit Union Magazine Managing Editor Sue Lanphear at slanphear@cuna.com. Qualified individuals:
* Are credit union employees or volunteers; * Are working or retired; * Are unsung heroes, going above and beyond to promote credit union philosophy; * Take a stand or exhibit a firm belief in credit union values; * Show dedication to credit union principles; and * Make a difference in the local community.

NYIB annual conference set for July

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FARMERS BRANCH, Texas (6/3/08)--The National Youth Involvement Board’s (NYIB) annual conference is set for July 28-31 at Caesars Palace in Las Vegas, with many business opportunities for credit unions. In addition to speaker and breakouts dedicated to youth marketing and financial education outreach, credit union staffers can gain leadership experience and recognition for youth outreach, said the Texas Credit Union League (TCUL) (LoneStar Leaguer June 2). With the average credit union member’s age (47) about 12 years older than the average American’s (35), credit unions have a need to attract younger people--not only in membership, but also in staff and volunteers, TCUL said. A report by the Credit Union National Association (CUNA) found that one in 100 credit union board members is under 30, and only 40% of nonmembers are familiar with credit unions--indicating a potential shortage of professional staff, as well as members. NYIB Chair John Faries, Space Age FCU, Aurora, Colo., issued a call for leadership opportunities within NYIB, and for logging all youth outreach programs on the organization’s website. The NYIB Executive Committee is made up of a chairman and six regional coordinators from regions across the country, serving two-year rotating terms, Faries said. “The coordinators oversee their region of the U.S. and keep in touch with their league liaisons. “It’s through the regional coordinators that some information is disseminated to leagues, credit unions and individual network members,” he continued. “Regional coordinators provide more of a local connection to NYIB, in addition to our listserv and website.”

Minneapolis may get first Muslim CU next year

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MINNEAPOLIS (6/3/08)--Minneapolis is slated to become the home to the first Muslim credit union in the U.S. The city’s African Chamber of Commerce--which is planning the credit union--currently has a database of 1,500 people who support the credit union, said Martin Mohammed, executive director of the chamber (Northwestern Financial Review May 15). The chamber’s five-year strategic plan drafted in 2007 calls for the formation of a credit union in an unspecified Minneapolis location in 2009. The credit union would provide services to people who are unbanked and families and establishments that conduct business according to tenets of Islamic law. The credit union will institute creative ways to adhere to religious restrictions that prevent Muslims from collecting interest on savings or paying interest on loans, Mohammed said. There is a significant Muslim population, not only in Minneapolis, but in the U.S., Mohammed said. He said the Minneapolis credit union can become a model for credit unions nationwide--particularly in California and Michigan in which there are significant Muslim populations--on how to provide financial services to Muslims.

IN.Y. TimesI to mortgage buyers Look at options like CUs

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MADISON, Wis. (6/3/08)--When seeking a mortgage, home buyers should look at options they haven’t thought of before, such as credit unions, according to a Sunday article in The New York Times. Organizations such as credit unions may offer buyers good rates and can help buyers through the loan process, the newspaper said. “Leave no stone unturned,” said Keith Gumbinger, vice president of HSH Associates, a mortgage research company, in the article. Lenders are interested in traditional buyers who will document their income and assets and don’t have large debts, he added. Sunday’s article, “What You Need to Know to Get a Mortgage,” focused on the challenges faced by many first-time buyers and sellers looking to move on to a new home. Because of the high rate of foreclosures, some buyers will have to look beyond the traditional mortgage options to finance their homes. Some banks now request 15% to 20% down on a home, compared with past estimates of 5% to 10% down, the newspaper said.

MDDCCUA presents Maxwell Herring Desjardins awards

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COLUMBIA, Md. (6/3/08)--The Maryland and District of Columbia Credit Union Association (MDDCCUA) Annual Awards Program presented three state-level Credit Union National Association recognition awards Wednesday. The awards honor credit unions for their efforts in the areas of common philosophy in daily operations, and youth financial literacy. First-place winners advance to the nationals. Dora Maxwell Social Responsibility Award:
* First place, $20 million-$50 million assets: Allegany Co. Teachers FCU, Lavale; * First place, $100 million-$200 million assets: Chessie FCU, Cumberland; * First place, $500 million or more assets: State Employees CU, Linthicum; * Second place, $500 million or more: MECU of Baltimore; and * First Place, CU Organization: Credit Union Miracle Day Inc., Washington, D.C.
Louise Herring Award for Philosophy in Action:
* First place, $100 million-$300 million assets: Chessie FCU; and * First place, $500 million or more assets: MECU of Baltimore.
Desjardins Youth Financial Education Award:
* First Place, $500 million or more assets: MECU of Baltimore; and * Honorable Mention, $500 million or more: State Employees CU.