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St. Louis treasurer taps CU to serve unbanked

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ST. LOUIS (7/25/14)--In her quest to connect unbanked residents with financial institutions, St. Louis' treasurer has called on a credit union to lend a hand.

Tishuara Jones, who said her top priority when first elected as the city's treasurer was to improve the financial health and literacy of local families, has asked 1st Financial FCU, Wentzville, Mo., to help her achieve her goal by offering free checking and savings accounts to youth in need ( St. Louis Business Journal July 20).

The $203 million-asset credit union will provide free accounts to 700 participants--between the ages of 16 and 20--of the Summer Youth Employment Program that kicked off this week.

1st Financial also will offer financial education, with an emphasis on saving, during orientation. Further, the accounts will have no overdraft, checking or debit fees, Tracy Verner, 1st Financial brand ambassador, told the St. Louis Business Journal.

"Studies show that those with savings accounts are more likely to go to college," Jones said.     

St. Louis has the third highest percentage of unbanked residents in the United States at 29% compared with the national average of 8.2%, according to a 2011 study by the Federal Deposit Insurance Corp. ( St. Louis Business Journal ).

The local impoverished, many of them minority residents, often turn to predatory lenders such as check cashers and payday loan businesses because they either don't trust or have access to traditional financial institutions.

The estimated cost of those alternative services in lost fees and interest, the St. Louis Business Journal reported, was $89 billion in 2012, according to Center for Financial Services Innovation numbers.

Other initiatives spearheaded by Jones include:
  • A monthly financial literacy program for city employees paid for by financial institutions;
     
  • Sponsorship of the annual Financial Empowerment Fair for the general public, an event she hopes to bring the city annually; and
     
  • Making direct deposit mandatory for 7,000 city employees, which has resulted in 800 opening accounts with local credit unions and other financial institutions.

CUs a compass on path away from bank fees: Daily Finance

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MADISON, Wis. (7/25/14)--When ditching a big bank and all the charges and fees that come with it, a credit union can be a great alternative when picking a new financial institution, a recent article in Daily Finance said.

Fees tend to be significantly lower at a credit unions because they are cooperatively owned, not-for-profit organizations that exist only to serve members, explained Daily Finance 's Carol Kopp.

"Historically, membership in a credit union is open to people with a common interest--members of a union, employees of a company or worshippers at the same place," Kopp said. "But many are open to an entire community."

To find a credit union when plotting your escape from a bank, the article suggests the National Credit Union Administration's credit union locator. Another option is www.asmarterchoice.org from the Credit Union National Association.

CU System briefs (07/25/2014)

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  • SAN DIEGO (7/25/14)-- San Diego County CU, with $6.5 billion in assets, hopes to set a Guinness World Record for document shredding on Saturday, when it invites San Diegans to bring old papers and try to fill more than 40 trucks with shredded remains ( Times of San Diego July 23). The free event is scheduled for 7 a.m. to 7 p.m. (PT) in the parking lot of Qualcomm Stadium. San Diego County CU is planning to set the record for the most paper collected in 24 hours. Last July, the credit union collected and shredded 168,147 pounds of paper, setting the current record and filling 40 trucks. Ten cents for every pound of e-waste collected goes to the San Diego Humane Society and the Society for Prevention of Cruelty to Animals (San Diego County CU Photo) ...
  • KANSAS CITY, Mo. (7/25/14)--After a lot of hard work on the part of both organizations, Kansas City CU, with $28 million in assets, was granted permission to install an ATM at the KCMO Water Department in Kansas City, Mo. ( Missouri Difference July 23). "Our employees and customers have always wanted an ATM to be placed in our lobby, but we had been turned down before by a bank," said Kandi Patterson, senior accountant for KCMO Water Services, when the ATM was installed July 15. "When KCCU approached us with the idea, we jumped at the opportunity." Patterson said the ATM will provide convenience for KCMO customers, giving them the ability to withdraw money to pay their water bills. Many KCMO employees and customers are Kansas City CU members, so the ATM gives them quick, fee-free access to their money ...

KCUA's Wright appointed as Kan. CU regulator

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TOPEKA, Kan. (7/25/14)--Jerel Wright, assistant vice president of compliance at the Kansas Credit Union Association, was appointed as administrator of the Kansas Department of Credit Unions by Gov. Sam Brownback.
 
As administrator, Wright will be responsible for overseeing the daily functions of the Department of Credit Unions, the Credit Union Council and the laws, regulations and exams for state-chartered credit unions.
 
"I enjoy so much what I do with credit unions right now that I will miss working with them," Wright, 56, told News Now . Wright has been with the Kansas league since 2005 and previously had another 11-year tenure with the league.

Wright also has been appointed state administrator in the past so this gives him "the chance to serve the state of Kansas again," he said. "I've been in credit unions all my career."
 
"Jerel brings a great deal of knowledge and experience to this position," Brownback said in a release. "I appreciate his willingness to serve the people of Kansas in this capacity."
 
Although the state Senate will have to confirm his four-year appointment when it reconvenes in January, Wright will begin working at the department in September. He succeeds John Smith, 76, who has been administrator since 2006.
 
Wright has a bachelor's degree in business administration and a law degree from Washburn University, Topeka, Kan. He earned his credit union compliance expert certification in 2008.
 

Landmark exam parity bill gets Ill. gov. signature

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CHICAGO (7/25/14)--The examination process for Illinois credit unions was just upgraded, as Gov. Pat Quinn signed a bill into law Thursday that will certify that the Illinois Department of Financial and Professional Regulation administers fair examination protocols for all state-chartered credit unions.

Sean Hession, Illinois Credit Union League president/CEO, left; Patrick Smith, vice president of communications and regulatory affairs; Steve Olson, executive vice president/general counsel/chief operating officer; Ashley Niebur, manager of state governmental affairs, and Keith Sias, vice president of governmental affairs, witness Ill. Gov. Pat Quinn sign HB 5342. (Illinois Credit Union League Photo)
HB 5342 will require all state regulatory examinations to be conducted in a procedurally and consistent manner, and aims to provide clarity, flexibility and authority in a number of operational areas.

The Illinois Credit Union League (ICUL) played a key role in drafting the bill, which passed both chambers of the Illinois General Assembly with wide-ranging support in May.  

The bill was sponsored by Deputy Majority Leader Rep. Lou Lang (D-Skokie) and Sen. Dave Koehler (D-Peoria), two longtime advocates for credit unions.

"There will now be standards that state-chartered credit unions can reference and rely upon with respect to the entire regulatory examination process," said Steve Olson, ICUL executive vice president/general counsel.

Added ICUL President/CEO Sean Hession: "The contents of the bill, as well as the rules and guidelines to promulgate it, are cause for celebration and will serve as a model across the country for state and federal regulators."

The key provisions of the bill include:
  • The authorization for credit unions to form charitable donation accounts, which will allow credit unions to reach for higher yields on charitable accounts as long as 51% of the returns are donated to a recognized charity;
     
  • The ability for credit unions to share daily operational services, correspondent services and fixed assets, which will allow them to achieve economies of scale and operate more efficiently;
     
  • Permission for credit unions to forego drafting a new appraisal during either a mortgage loan renewal, refinancing or restructuring when no money is advanced;
     
  • The requirement for Illinois credit union board members to have a basic understanding of a credit union's financial statements, services, products operational risks and internal control structures; and
     
  • The requirement that Illinois credit union supervisory committee members receive annual training to their statutory duties.

CUs get national online tool for communicating reg concerns

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WASHINGTON (7/25/14)--PowerComment, a new online resource that helps credit unions take their regulatory concerns directly to state and federal regulators, was officially announced at the summer American Association of Credit Union Leagues (AACUL) meeting Thursday.

Developed by the California and Nevada Credit Union Leagues, and now being taken national by Credit Union National Association, PowerComment is an interactive tool that allows all CUNA-affiliated credit unions to write and immediately submit comment letters on regulatory proposals directly to the National Credit Union Administration, the Consumer Financial Protection Bureau and other federal and state regulators.

Credit unions can read proposed rules and how they might affect their operations and members, as well as ask fellow PowerComment users or their leagues questions related to proposed rules. In addition, they can view letters submitted by other credit unions and their leagues on the website, available exclusively to CUNA-affiliated credit unions.

"This is the power of the CUNA-League System at its best," remarked CUNA General Counsel Eric Richard. "CUNA is pleased to leverage the great of work the California and Nevada Credit Union Leagues to effectively deliver credit union comments back to the regulatory agencies."

The national rollout of PowerComment now makes it easier for credit unions throughout the United States to voice their concerns and comment on proposed rules, especially in this challenging regulatory environment," said California and Nevada Credit Union Leagues President/CEO Diana Dykstra. "By commenting at the beginning of the process, credit unions can help shape the rules, and mitigate overly burdensome directives."

Prior to the national rollout, PowerComment was tested by 10 leagues, including the Northwest Credit Union Association (NWCUA).

"PowerComment allowed us to easily track regulatory proposals, get insight from colleagues and write effective comment letters," said NWCUA President/CEO Troy Stang.

"The analysis and reminders are another benefit that helped us successfully manage our time in an efficient manner. PowerComment is an additional tool in the credit union toolbox that we look forward to seeing available to a broader audience," he added.

Use the resource link to check out the new tool.

Debit use bolsters noncash payments, says Fed payments study

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WASHINGTON (7/25/14)--Consumer use of electronic payments--whether by card or via automated clearing house (ACH)--continues to outpace cash and checks, according to updated statistics from the 2013 Federal Reserve Payments Study.
 
Of the 776 million plastic cards used in the United States in 2012, 334 million were credit cards, 283 million were debit cards and 159 million were prepaid cards.
 
Consumers pulled out their debit cards for an average 23 payments per month compared with an average of 11 payments per month for credit cards and 10 for prepaid cards. In 2012, the number of debit card payments reached 47 billion--significantly higher than the 26.2 billion credit card payments.
 
The number of online bill payments--through online banking websites, directly through billers and settled via ACH--exceeded 3 billion in 2012.
 
Notable is the use of mobile payments: Mobile wallet applications accounted for more than 250 million mobile payments, and there were at least 205 million person-to-person or money transfer payments.
 
Check usage continues to decline, although, when used, almost all checks in 2012 were either cleared by electronic image exchange or converted to ACH payments. More than 90% of the drop in total checks was due to reductions in checks for $500 or less.
 
The number of fraudulent transactions in 2012 was 32.2 million worth $6.4 billion. Only 5% of the 32.3 million were made via ACH, and checks had the lowest unauthorized transactions at 3%.
 
This revised report updates data from the December 2013 original report.  The 2013 Federal Reserve Payments Study is the fifth conducted since 2001 by the Federal Reserve System to estimate aggregate trends in noncash payments in the United States. Estimates are based on survey data gathered from depository and financial institutions, payment networks, processors and issuers.

N.Y. young professionals shine in leadership role on Hill

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ALBANY, N.Y. (7/25/14)--Seven members of the Credit Union Association of New York's (CUANY) Young Professionals Commission (YPC) demonstrated their leadership skills this week and furthered the advocacy efforts of the state's credit unions during the league's Hike the Hill event in Washington, D.C.
 
Click to view larger image From left: Mike Lanotte, Credit Union Association of New York; Cristina Morrissiey, AmeriCU CU, Roma; Meghan McGee-Pelkey, UFirst FCU, Plattsburgh; David Roy, Buffalo Metropolitan FCU; Jennifer Preston, Reliant Community FCU, Sodus; Rep. Dan Maffei (D); Kayla Barber, Dannemora FCU, Plattsburgh; Angela Hitchcock, Sidney FCU; and Brittney Wensley, Sunmark FCU, Latham (Credit Union Association of New York Photo).
For the second straight year, members of the under-35 group joined the league in visits with lawmakers on Capitol Hill. But the young professionals weren't there as observers. When possible the league arranged visits with lawmakers from the districts where the commission members' credit unions were located. Each young professional then took the lead in presenting the credit union advocacy case before his or her district's lawmaker.
 
"The YPC member would introduce the group and present the topics on our agenda," Cristina Morrissiey, financial center manager at AmeriCU CU, Rome, with $1.2 billion in assets, told News Now . "When we completed our presentation, and everyone had contributed, we asked the lawmaker or staff member for their support and thanked them. We took a very active role in this, with a lot of support from the assocation and CUNA."
 
On Monday, the group convened at the Credit Union House for a legislative briefing led by Mike Lanotte, CUANY senior vice president/general counsel, and staff from the Credit Union National Association. Following the briefing, the advocates then met with representatives from the offices of Sens. Charles Schumer (D) and Kirsten Gillibrand (D), both of New York. For several of the young professionals, it was their first time lobbying at the federal level.
 
The advocacy efforts continued Tuesday, when the group met with nine House members and staffers. Lawmakers on both sides of the political aisle encouraged the group to continue advocating on behalf of their members ( The Point July 24). Some representatives, including Rep. Dan Maffei (D), praised the YPC and acknowledged the important role that credit unions play in low-income and rural communities.
 
In total, the group was able to meet with representatives or staff from one-third of the New York congressional delegation, including: Reps. Tom Reed (R), Chris Collins (R), Chris Gibson (R), Richard Hanna (R), Bill Owens (D), Brian Higgins (D), Louise Slaughter (D), Paul Tonko (D) and Maffei.
 
Meghan McGee-Pelkey, marketing specialist, UFirst FCU, Plattsburgh, with $57 million in assets, told News Now , participating in the hikes helps her gain a more complete perspective of working within the credit union system.

"You know about your CEO and upper management going to CUNA's Governmental Affairs Conference, but you don't understand exactly what's happening there," McGee-Pelkey said. "You don't understand that behind your job, there are all of these issues that are affecting your credit union. Having the association invite us to Washington to present these issues on behalf of our credit union is an amazing experience."
 
Other YPC members participating in the hikes included:
  • Kayla Barber, Dannemora FCU, Plattsburgh, with $141 million in assets;
  • Angela Hitchcock, Sidney FCU, with $385 million in assets;
  • Jennifer Preston, Reliant Community FCU, Sodus, with $376 million in assets;
  • David Roy, Buffalo Metropolitan FCU, with $90 million in assets; and
  • Brittney Wensley, Sunmark FCU, Latham, with $404 million in assets.
McGee-Pelkey said the CUANY's YPC initiative has presented her and other members with leadership opportunities and responsibilities beyond this week's Washington visit. "There are several YPC members who are becoming more involved with their chapters and committees," she said.

"For example, we have a young professional commission member that is the president of her chapter. I myself am a CULAC/CUPAC trustee, and I sit on the council for my chapter.  So being a part of the YPC has opened so many new opportunities for me that I never expected to have in my career as a credit union professional, and that includes hiking the hill."

Make reservations now for CU Lunch Local on Oct. 14

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LANSING, Mich. (7/24/14)--For the third year, CU Lunch Local aims to put thousands of dollars back into the pockets of Main Street businesses with its nationwide cash mob program that also promotes the credit union difference.
 
CU Lunch Local, set for Oct. 14 during International Credit Union Week, originated two years ago with Michigan credit unions and Michigan Business Connection. Credit unions commit to buying local, infusing cash into their communities and raising credit union awareness.
 
This year's goal is to expand even further beyond the borders of Michigan. Participating credit unions can promote their activities on the CU Lunch Local Facebook page, and the #culunchlocal hashtag will help spread the word in social media.
 
In the past, credit unions have comped cups of coffee, purchased supplies from local businesses or partnered with locally owned restaurants to offer discounts to credit union members.
 
Credit unions interested in participating can use the CU Lunch Local Facebook page or contact Jessica Richardson-Isenegger at jessica@in-fusiongroup.com .

Nearly 50 kids become mini-billionaires at Fla. CU

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TALLAHASSEE, Fla. (7/24/14)--It's summer camp for kids, with a twist.

The Pink Team at the Mini Billionaire's Academy captured all five flags, each one tied to their credit score, allowing them to get "approved" for a loan. (Tallahassee-Leon FCU Photo)
Is there capture the flag? Yes, but a captured flag improves your credit. Are there egg-carrying relay races? Of course, but the faster you run, the faster you invest in the stock market, which can be a risky play.

These were the types of games, and financial lessons, played and learned by the nearly 50 kids who attended this year's Mini Billionaire's Academy, a five-day overnight camp hosted by Tallahassee-Leon FCU, Tallahassee, Fla., with $43 million in assets.

The academy, geared towards kids ages 8 to 16, educates participants on personal financial management using entertaining and engaging games. In its third year, this year's academy was the largest class yet.

"Students are graduating high school, and even college, with almost no formal training on personal money management and we are proud to be able to fill that gap in our community," said Lisa Brown, Tallahassee-Leon president/CEO.

The camp, which started as a one-day event in a community center, has become so popular that it has been moved to the expansive Wallwood Boy Scout Reservation in Gadsden County where campers can canoe, bike, go zip-lining and more, Mike Akers, Tallahassee-Leon vice president of sales and services, told News Now .

"My favorite quote from parents is they wish they had something like this when they were a kid," Akers said.

Florida State Rep. Alan Williams (D-Tallahassee) stops by to speak to the campers about the importance of responsible money management. (Tallahassee-Leon FCU Photo)
Other activities included a s'mores store competition that challenged campers to run their own businesses; campfire skits about budgeting; and a reality fair where campers were assigned careers and had to make financial decisions based on their unique financial situations.

A grant from "Biz Kid$," an award-winning PBS TV program supported by the National Credit Union Foundation that teaches kids about fiscal responsibility, helped Tallahassee-Leon put on the camp this year. Many campers received partial or full scholarships to attend as well.

"It's so rewarding to see how responsible the campers are by the end of the program," Brown said. "A little bit of fun will equip them for the rest of their lives."

CU System briefs (07/24/2014)

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  • ALBANY, N.Y. (7/24/14)-- New York Gov. Andrew Cuomo Tuesday signed into law a five-year extension of the state's wild card law that provides state-chartered credit unions, banks and thrifts with the opportunity to exercise the same banking powers that are available to federally chartered institutions ( The Point July 23). The Credit Union Association of New York (CUANY) strongly advocated for the law by working diligently with the governor's office and state lawmakers in the weeks and months leading up to its passage. "This extension of the wild card provision is an important piece of the state charter," said Mike Lanotte, CUANY senior vice president/general counsel. "Thanks to the support of lawmakers on both sides of the political aisle, the state's banking charter will remain competitive with the federal charter." ...
     
  • ST. LOUIS (7/24/14)--Part of the Missouri Credit Union Association's (MCUA) Bank On More program included a "takeover" last weekend of St. Louis' Coffee Cartel ( Missouri Difference July 21). For six hours, Bank On More helped customers "Live Larger" by providing free drink upgrades, which came wrapped with a #BankOnMore coffee sleeve. Coffee Cartel customer Gabriel, left, learns about the credit union locator from Nora Holloway, MCUA public relations/online community director  (Missouri Credit Union Association Photo) ...

CUNA's certified fin. counselors now number 2,175

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MADISON, Wis. (7/24/14)--With nine recent program completions, the Credit Union National Association now counts 2,175 credit union professionals as certified credit union financial counselors (CCUFC).
 
CCUFC-designated professionals help counsel members through current and future financial situations.
 
"The training provides great skills whether you are a loan officer or a counselor," said new designee Jamie Fatheree, American Airlines FCU, Fort Worth, Texas, with $5.6 billion in assets. "Even if you have been counseling for a while, you learn things you didn't know or hadn't thought of before. The program gave me a network of other counselors to bounce ideas off of and share what works."
 
Fatheree received her designation for completing the second part of the program at CUNA's Certified Financial Counselor School in June.
 
Other CCUFC designees are:
  • Ariane Aughenbaugh, Franklin-Oil Region CU, Oil City, Pa., with $35 million in assets;
  • Janine Bethel, Grand Bahama Co-op Credit Union Ltd., Freeport, Bahamas;
  • Michelle Bryant, Blue Eagle CU, Roanoke, Va., with $126 million in assets;
  • Kimberly Gaines, Pelican State CU, Baton Rouge, La., with $234 million in assets;
  • Sandra Gladney, American Airlines FCU;
  • Crystal Jepsen, North Star Community CU, Cherokee, Iowa, with $79 million in assets;
  • Heather Smith, Credit Union One, North Jackson, Ohio, with $10 million in assets; and
  • Cheryl Welles, Empower FCU, Syracuse, N.Y., with $1.2 billion in assets.
In addition to the on-site school, the CCUFC designation can also be earned by successfully completing parts one and two through the CUNA Certified Financial Counselor eSchool or CUNA Financial Counseling Certification Program.

USDA recognizes Royal CU's $5M rural mortgage lending effort

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STEVENS POINT, Wis. (7/24/14)--Royal CU, Eau Claire, Wis., with $1.4 billion in assets, is the recipient of the 2013 Platinum Million Dollar Lender Award by U.S. Department of Agriculture Rural Development State Director Stan Gruszynski.

The annual award is presented to lenders that have partnered with and made significant contributions to supporting rural residents in Wisconsin who are looking to become homeowners through the USDA Guaranteed Rural Housing (GRH) program.

"As a result of the Guaranteed Rural Housing program, we have been able to help many more members accomplish the dream of homeownership," said Matt Gerber, Royal CU vice president of mortgage loan sales. "This particular program is one of the only remaining no-down-payment programs offered in the industry."

In 2013, Royal leveraged more than $5 million of GRH program funds to help finance home purchases for families of moderate income in Wisconsin. Nearly 4,000 families across the Badger State bought homes last year thanks to the GRH loan program.

Loans secured through the program are financed by participating lenders and guaranteed by USDA Rural Development. The loan amount is limited to the applicant's ability to pay off the mortgage.

Eligible areas include rural regions or communities under 20,000 in population.

The past few years have been challenging for homebuyers in rural areas of Wisconsin, Gruszynski said, adding: "Working with our lending partners across the state, we've made a difference to those rural families prepared to realize the responsibility and benefits of owning a home."

Suspected Goodwill breach, mobile threat keeps members on toes

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MADISON, Wis. (7/24/14)--Goodwill Industries International apparently is the latest retailer to have fallen victim to a data breach, and with this news, it's likely no surprise that a third of global consumers don't trust retailers to protect their personal and financial data.
 
The company learned last week that an investigation was under way regarding theft of payment card numbers at select U.S. store locations, Goodwill said on its website, but cybersecurity expert Brian Krebs reported that a fraud pattern has appeared in at least 21 states ( KrebsonSecurity.com July 21).
 
Add Goodwill to breaches at Target, Neiman Marcus, Sally Beauty Supply, Michaels and P.F. Chang's, and negative consumer sentiment toward retailers is not surprising.
 
ACI Worldwide and Aite Group recently released the second part of a study on financial fraud that found 58% of global consumers think financial institutions do a better job of protecting their data than retailers, restaurants, large chain stores, government agencies or law enforcement.
 
Meanwhile, the ubiquity of mobile devices is making them a target of malware. Last month, the Trojan-type malware Svpeng made its appearance in mobile banking applications. It checks for banking apps on a user's phone, then locks it down, in effect holding it hostage until the user coughs up money on a prepaid card.
 
Security experts at FireEye recently uncovered HijackRAT--a triple threat of banking credential theft, remote access takeover and the destruction of anti-virus applications on Android devices.
 
Mobile phone users tend to value convenience over security, giving credit unions an opportunity to educate them about good mobile financial habits such as not using public Wi-Fi to access banking accounts and using authorized apps only from the credit union or financial institution ( Pittsburgh Tribune-Review June 28).
 
Regardless of where the fraud began, it's how it's handled that makes the most impression on consumers, ACI and Aite found. Twenty-three percent of respondents left their financial institutions because of how their fraud cases were handled.

Newspaper's shreditorial lauds CU's no-greed, good deed

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PLATTSBURGH, N.Y. (7/24/14)--Shred events--during which local businesses volunteer to run confidential documents through a shredder for the general public--don't capture many headlines. But the Plattsburgh, N.Y., Press-Republican dedicated resources and editorial space in its July 22 edition to emphasize the "good deed" Dannemora FCU offered its local community in sponsoring its seventh annual Shred Fest.
 
"If you don't understand how valuable this service is, think back to the many cases that have been talked or written about in which identities and crucial personal information have been pirated, so unscrupulous people could cash in on it: numbers on bank accounts or credit cards, for instance," the Press-Republican reminded its readers.

"Once secured by dishonest people, those numbers could be exploited for large sums of money, loss of reputation, illegal documents or other outcomes bound to do damage. Shredding is now a way of life for the savvy," it continued.
 
And, the paper reminded readers, the occasion "did double duty as a public benefit." The $141 million-asset, Plattsburgh, N.Y.-based credit union asked "shredders" to bring nonperishable food items for Plattsburgh Interfaith Food Shelf.
 
The paper noted that Ticonderoga (N.Y.) FCU, with $91 million in assets, recently held its first Shred Fest, which produced more than 5,600 pounds of shredded paper and brought in more than $440 in food to be split among three area food pantries.
 
"The credit unions have provided a service that is truly important in this era of identity theft, and the number of people who showed up at the Plattsburgh event last Saturday prove how much the service is valued," the editorial concluded. "An institution that derives its name from the credit it distributes has earned a little for itself."

Small businesses get networking night with US FCU

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BURNSVILLE, Minn. (7/24/14)--To gain the trust of the business communities they seek to serve, credit unions must build true partnerships with potential members. US FCU, Burnsville, Minn., with $970 million in assets, will take a big step toward doing that when it hosts a business open house and social media seminar Aug. 12.
 
The credit union has partnered with the local Better Business Bureau local social media consultant KS95/Hubbard Interactive and other local resources to provide small business owners and prospective small business owners with information and networking strategies for running their businesses.
 
One of those resources is Open to Business, a partnership among local cities and developers that provides one-on-one business counseling to current and prospective entrepreneurs and possible access to the Metropolitan Consortium of Community Developers small business loan fund.
 
"One of the things we see is that business owners are really good at what they know, and that's their actual business, but when it comes to the other side of running a business, like back office needs and handling money, that's not their strength," Reyna Staats, US FCU senior business development specialist, told News Now . "This is a way for us to show how we can help them out and what resources they have available to them."
 
The open house is also a way for the credit union to spread the word about its services, Staats said. "A lot of people still don't know that credit unions have business accounts and have business loans," she said. "We want to the community to know that US FCU can serve your business needs as well."
 
Actually, US FCU views itself as more than a provider of business services, Staatz told News Now . "Half my job is to educate, and find what truly is the best fit financially for the businesses we serve. Education is very important to everything we do for both our personal and business account members."

Iowa league survey touts value of college education

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DES MOINES, Iowa (7/23/14)--It might be reasonable to assume most U.S. citizens believe college is important, but many still often struggle with figuring out how to finance such a major expense.

In response to survey by the Iowa Credit Union League that once again demonstrated the value people place on a college education--70% of Iowans said a college degree is worth the financial investment--the Iowa Credit Union Foundation (ICUF) has offered up tips on how to tackle paying for school.

"With tuition costs on the rise, it's important for consumers to begin planning their financing as soon as possible," said Jamie Miller, ICUF executive director. "There are many college financing options available, and which one you choose will depend on your individual needs."

The foundation proposes several tips for financing a college education including:
  • Start saving now: Whether you're months, years or decades away from paying for college, start saving today, as the earlier the money is put away, the more time it has to grow. Take advantage of college savings calculators to determine how much you will need to save.
     
  • Seek assistance: Speak with an experienced financial adviser about college savings goals and financing options who can present the advantages and disadvantages to each possible method.
     
  • Do the research: There are several options available to finance a college education, including scholarships and grants, prepaid tuition plans, 529 college savings plans, work-study programs and individual retirement accounts. Look into each option and meet with a financial adviser to learn the full benefits of each.

Mountain America CEO helps TV audience understand credit scores

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SALT LAKE CITY (7/23/14)--To help viewers understand how credit bureaus calculate credit scores, Sterling Nielsen, president/CEO of Mountain America CU, West Jordan, Utah, with $3.9 billion in assets, offered up some insight during a recent appearance on KSL-TV 5 's "Studio 5 with Brooke Walker" in Salt Lake City.

"There are three main (credit reporting agencies), and they all look at things just a little bit differently," said Nielsen.

"First of all you need to make sure that you watch that credit history," he advised. "Make sure that you make your payments on time; they're going to look at how often you make a late payment, how late that payment is (and) how many accounts are late. These all play a big part in your credit score."

Next, Nielsen said, consumers should pay attention to their levels of credit utilization and make sure they're not using too much of their limits.  

"A lot of people think, 'Hey, I have a $5,000 credit card (limit), I might as well charge it all up,'" Nielsen said. "But that hurts your overall credit score. You're better off keeping your utilization down to about 30%," even if you pay off your balance every month. 

Finally, consumers should work to build a strong credit history, Nielsen said.

"You want to show a period of time when, not only were you paying your bills on time, but you were managing credit responsibly," Nielsen said. "The length of time is quite important in managing your credit score."

Nielsen added that consumers with credit scores of 700 or above likely will receive the most advantageous interest rates, while those with credit scores below 600 will not fare as well.

CU System briefs (07/23/2014)

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  • MADISON, Wis., and ST. PETERSBURG, Fla. (7/23/14)-- PSCU, a card services credit union service organization, signed a three-year agreement to be the premiere sponsor for the Global Women's Leadership Network Sister Societies. Sister Societies, which have been established in the United States and five other countries, are local groups of Global Women's Leadership Network members who gather regularly to exchange ideas and share information. PSCU's financial support will help underwrite initiatives that promote gender balance at the executive level and increase leadership opportunities for women in the credit union industry. The Global Women's Leadership Forum begins Saturday at the World Credit Union Conference in Australia and is expected to draw 100 women leaders from 22 countries  ...
     
  • WAUKEGAN, Ill. (7/23/14)-- Consumers CU, a $614 million-asset credit union in Waukegan, Ill., has a new mascot that--as the name implies--earnestly engages community members. Earnest the Pig has been making the rounds at festivals and fairs. "We wanted to create an image that would resonate with people of all ages--an icon that would work with both traditional and new-age, social media marketing," said Maria Contreras, marketing manager at the 85-year-old credit union. "The public reaction has been fantastic and as a result, we have many more activities lined up for him." While on location, Earnest provides stickers and photo opportunities for kids, but he also refunds ATM fees for adults, as he did for Anne Van Van Der Basch (Consumers CU Photo) ...
  • ATLANTA and CHESAPEAKE, Va. (7/23/14 )--Floyd County Postal Employees CU, a $3.7 million-asset credit union in Rome, Ga., has merged with $2 billion-asset Atlanta Postal CU ( Northwest Georgia News July 21). The branch that served as Floyd County Postal Employees CU will be relocated to an expanded location this fall and will include a drive-through ATM and shared-branch services. Members Alliance FCU, Columbus, Ga., with $26 million in assets, also recently merged with Atlanta Postal CU . In Virginia, the boards of Guardian FCU, Portsmouth, with $43 million in assets, and ABNB FCU, Chesapeake, with $420 million in assets, have approved a merger which, if approved by members, would become effective Nov. 1. "Is it better to go out on the top of your game or something less?" Guardian FCU's President/CEO Chris Anuswith told Hampton Roads Business Journal (July 21). "There's no reason to wait for that when we can get together and make something that is far stronger than we are individually" ...

NFL's Cushing continues spokesman, outreach role for Houston CU

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HOUSTON (7/23/14)--First Community CU has extended its partnership with Houston Texans linebacker Brian Cushing, who will continue as spokesperson for the $1 billion-asset Houston-based credit union through 2016.
 
Cushing will continue his participation in First Community CU's annual "Stars in the Classroom" program, which rewards 10 deserving teachers for going above and beyond in the classroom. The teachers are awarded football tickets, sideline passes and an autographed jersey. In addition, a $500 donation is made to each teacher's school district and Cushing or one of his teammates visits the teacher's classroom. The nominating student receives an autographed Houston Texans football.
 
Cushing served as the credit union's spokesperson last year and was part of the financial institution's award-winning TV commercial, radio and print ads as well as billboards and other promotions. First Community is developing a new marketing campaign for 2014-2015 with Cushing as the creative centerpiece.
 
Cushing has played in the NFL since 2009 after being drafted from the University of Southern California as the Texans first-round pick. Since entering the league, Cushing has been voted NFL defensive rookie of the year, selected to the Pro Bowl and named the Texans' most valuable player in 2011.

First Community CU also is the official credit union of the Houston Texans and the exclusive provider of Texans Checking, which features a customized Texans debit card, chances to win autographed merchandise and access to exclusive events.

CU programs are tailor-made for Hispanic members' success

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FARMERS BRANCH, Texas (7/23/14)--Hispanics are likely to have clear financial goals but are unsure about how to achieve them, according to a recent survey by Prudentia, thus giving credit unions an opportunity to start conversations about how they can support these goals.
 
Prudential's "Hispanic American Financial Experience" report found that personal debt is culturally taboo--62% indicated there is no such thing as "good debt"--and the desire by almost half of respondents to pay for items with cash.
 
However, nearly 70% recognize that living debt free is not possible, which may create educational opportunities for credit unions and other financial institutions, the report noted.
 
The Prudential study was conducted Oct. 28-Nov. 18 and polled 1,023 Americans age 25-70 who self-identified as Hispanic, had a household income of more than $25,000 and had some involvement in household financial decisions.
 
Through increased community involvement and financial literacy opportunities, credit unions can engage the Hispanic community in setting goals. This is a tactic taken by some credit unions in the Cornerstone Credit Union League's Juntos Avanzamos program.
 
"There is a great financial opportunity for credit unions in the Hispanic market," said Bob Peterson, chair of Cornerstone's International Relationship Committee ( Leaguer July 17). "However, if we want to earn their business, we have to be at the forefront of educating them on how we can help them meet their financial goals."
 
Peterson is also president/CEO of $90 million-asset OneSource FCU, El Paso, Texas--one of 28 credit unions that have received the Juntos Avanzamos (Together We Advance) designation.
 
The Prudential survey also asked what financial institutions could do to better meet Hispanics' needs. The leading answer was to be more involved in the community, followed by having the ability to communicate in Spanish; offer financial education for the community; tailor products/services to the community; provide jobs for Hispanic workers; and use easy-to-understand language.
 
Southwest 66 CU, Odessa, Texas, has tailored products and services to its local Hispanic community. President/CEO Sean Cahill said the $85 million-asset credit union--also a member of the Juntos Avanzamos program--has created a number of specialty loans including a "borrow and save" loan to combat payday lending and establish savings behaviors and a quinceanera loan to cover the cost of celebrations held for girls' fifteenth birthdays ( Perspectives June 26).
 
"The thing we are most proud of is our citizenship loan, as it combines funding with community partnerships," Cahill said. "There are five unique stages to this loan, and each stage requires a commitment from the member before the next portion is funded. We use a local attorney to ensure the member is protected, and make local (English as a Second Language) partnerships to bring the greatest value to the member. We even offer a loan for a suit or dress for the member to wear while attending their citizenship ceremony."

85% of members feel 100% safe with a CU: Filene

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MADISON, Wis. (7/23/14)--Because they hold credit unions in such high regard, credit union members are more likely than bank customers to keep a greater portion of their holdings with their financial institution--an encouraging development as credit unions continue to seek ways to expand member outreach, according to a new Filene Research Institute white paper.
 
"The Consumer Experience: Financial Institution Preference and Usage Factors," which analyzed McKinsey and Co. survey data from 2013, found that 85% feel their assets are completely safe at their credit union, while only 68% of bank customers feel the same about their institution.

"Credit unions can't prevent every member from shifting their funds or closing their account, but the current outlook for growth is extremely promising," the report noted. "Research is showing how effective credit unions are at creating trust with their members.
 
"As long as this trust is sustained, there is no reason to think credit unions can't grab more market share," the report continued. "We have learned that consumers choose financial institutions based on income, age and attitudes toward service offerings. These preferences are always subject to change. The onus will be on credit union leaders to ensure they don't."

"Lessons learned" in the report included:
  • Credit union members keep a greater portion of their holdings with their primary financial institution than bank customers;
  • Wealthy consumers with more than $150,000 in annual income tend to keep a smaller proportion of their personal assets at their primary financial institution;
  • Consumers with less than $20,000 in household income keep 80% to 100% of their total assets with their primary financial institution;
  • Consumers who use a credit union as their primary financial institution are much more likely than bank customers to agree strongly with positive statements about their primary financial institution;
  • Forty-eight percent of credit union members feel their credit union rewards them for remaining loyal to their brand, compared with 34% of bank customers;
  • Between 75% and 90% of consumers use websites to check balances;
  • Those who use a credit union as their primary financial institution consistently report the highest level of satisfaction with various attributes of their primary financial institution;
  • Only 14% of respondents with incomes of less than $20,000 switched financial institutions for better products, rates, fees or returns; and
  • Forty percent of respondents with more than $150,000 in annual income switched to find better products, rates, fees or returns.
To download the white paper, use the link.

NWCUA launches relief effort for central Wash. wildfires

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PORTLAND, Ore. (7/23/14)--The credit union community is offering assistance to victims of the Carlton Complex fire in central Washington, with an initial $5,000 donated by the Northwest Credit Union Foundation (NWCUF).

NWCUF also is encouraging online donations--a similar effort earlier this year resulted in $108,000 in contributions from credit unions and leagues across the nation for victims of the Oso mudslide.
 
The fire burned another 7,000 acres overnight Monday, the Northwest Credit Union Association reported Tuesday ( Anthem July 22). An estimated 150 homes have been destroyed. The Carlton Complex fire is the largest of several wildfires burning in Washington and Oregon this week.
 
"Credit unions in our region have shown time and time again that they understand how important it is to provide immediate support and they always step up when there is a disaster," said Kim Vu, NWCUF executive director. "We always realize that these are not just members of our credit unions, but they also part of the local communities we serve who could be losing their homes and this is when they most need us."
 
Credit unions are raising funds and offering financial assistance to members who may be directly affected by the wildfires. Spokane Teachers CU, with $1.9 billion in assets, Liberty Lake, Wash., is leveraging a longtime relationship with the American Red Cross and a local television station to raise emergency funds for fire victims.
 
Numerica CU, with $1.3 billion in assets, Spokane Valley, Wash., reached out to members through its popular Facebook site to offer both financial assistance and personal support. A spokesperson for Numerica CU reports that as many as 30 members in the Patero location live in one of the active fire zones and could be at risk.
 
Numerica CU also encouraged employees to support the fundraising. For a donation to help victims of the wildfires, employees will receive "Casual for a Cause" coupons valued at $25.
 
In addition, the credit union is sponsoring the Rain Down Hope Benefit Concert today to benefit the Chelan Valley Hope Fire Relief Fund.
 
Credit unions and employees interested in making a donation can donate directly through the NWCUF to benefit the Community Foundation of North Central Washington's Fire Relief Fund.

Plaintiffs push to continue Target data breach class action

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MINNEAPOLIS (7/23/14)--In response to Target Corp.'s attempt to delay discovery in multidistrict litigation regarding last year's data security breach, plaintiffs filed a joint memorandum opposing Target's request.
 
Earlier this month, the retail giant requested a stay of discovery for the multidistrict litigation, citing a desire to wait until rulings are made on motions to dismiss the class-action lawsuits brought by consumers and financial institutions. This could push discovery until as late as November.
 
"Given the burden that discovery regarding potentially moot questions would impose on the parties and this court, good cause exists for continuing the discovery stay for a few months until the motions to dismiss can be resolved," the retailer said ( Law360 July 3).
 
However, last week, plaintiffs fought the attempted delay of discovery with a joint memorandum filed in the U.S. District Court in Minnesota. "Fact discovery should begin and should not be delayed," the memorandum says, adding that "federal courts disfavor staying discovery while a motion to dismiss is pending, and here, Target has not met its burden of demonstrating that its anticipated motion to dismiss will resolve all claims in its favor."
 
The memo adds, "Target's arguments that Financial Institution Plaintiffs' claims will be dismissed and that Consumer Plaintiffs lack standing are premature and incorrect. Neither argument warrants a stay of discovery. Accordingly, this Court should deny Target's Motion."
 
Financial institution plaintiffs' consolidated complaint will be filed Aug. 1, and Aug. 25 is the due date to file the consumer plaintiffs' consolidated complaint.
 
In May, U.S. District Judge Paul Magnuson said "big, long, indefinite stays" for the class-action lawsuits would not be appropriate ( News Now May 19).
 
Target revealed Dec. 19 that about 40 million debit and credit card numbers were compromised as was the personal information of as many as 70 million customers.
 
A survey by the Credit Union National Association found that credit unions incurred $30.6 million in costs directly related to the breach--not including fraud costs. CUNA is pressing federal lawmakers to address data security relative to merchants, who are not held to the same standards of security as credit unions and other financial institutions.

CU Social Good, CafeGive partnership to measure 'return on intent'

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BISMARCK, N.D. (7/22/14)--Two social media resources are partnering to help promote and gauge the work that credit unions do for their communities.
                                       
CU Social Good, a program of the Credit Union Association of the Dakotas (CUAD), has partnered with CafeGive Social, a company that focuses on measuring the "return on intent" of social media campaigns and community involvement.
 
With CafeGive, CU Social Good will be able to aggregate the data provided by credit unions to generate customized social impact reports, putting real numbers to the benefits that credit unions provide to their communities.
 
The results can then be used for public relations, consumer awareness and legislative and grassroots advocacy.
 
CU Social Good is an online platform that collects stories of the credit union "people helping people" philosophy.
 
CUAD is working with CafeGive on a prototype and anticipates a September launch. 
 
CafeGive Social offers apps that create awareness for causes and encourage community involvement; a dashboard to track social engagement; and a tool for fundraising that includes an element for donation matching.
 
Among its campaigns are "[MOO]ve Against Hunger," currently running at Mid-Atlantic FCU, Germantown, Md., with $279 million in assets; "Make the Match," which helped Educators CU, Racine, Wis., with $1.5 billion in assets, match donations for a Children's Miracle Network Hospital fundraiser; and "Roll On Seattle," a bike loan and social awareness program from Seattle-based Verity CU, with $438 million in assets.

Kids coached to financial field goals at Bayport CU

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NEWPORT NEWS, Va. (7/22/14)--Grasping personal finance concepts isn't easy, or a lot of fun for most people, but football is almost second-nature to Americans. Bayport CU, with $1.3 billion in assets, Newport News, Va., recently used the game as a tool to teach school-age children about financial education.
 
Fifth- through eighth-grade students from the Boys and Girls Club Suffolks Unit played financial football ( Suffolk News Herald July 19). Participants could choose passing or running plays to move the ball down the field. The more difficult the question they chose to answer, the farther a correct reply would move the ball down the field.
 
But an incorrect answer gave defense a chance to answer correctly--and an opportunity to create a turnover or a loss of yardage against the offense.
 
Like a real game, the financial football contest was preceded by training. The students spent the previous part of the week learning about personal finance from Bayport CU employees. Among the topics addressed were income and expenses, budgeting, the importance of saving, credit and debit cards and information security.
 
The competition provided by financial football gave the kids an opportunity to show how they absorbed some of the financial concepts, Kris Moore, Bayport youth educator, told the Suffolk News Herald .
 

Worldwide CU growth: Nearly 57K CUs now serve 208M members

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MADISON, Wis. (7/22/14)--By the end of 2013, nearly 57,000 credit unions served about 208 million members across 103 different countries worldwide, according to numbers released by the World Council of Credit Unions this week in its 2013 Statistical Report.

Click to view larger image Click for larger view
The report tracks membership and financial data for credit unions and financial cooperatives throughout the world.  

The largest change from 2012 was the jump in membership growth, which climbed by more than 7 million members. The regions that posted the strongest growth in membership were Asia, Latin America and Europe.

Worldwide assets in 2013 came in at $1.7 trillion, according to the report, with savings topping $1.4 trillion, loans $1.1 trillion and reserves $171 billion.

"Large, small, emerging and mature systems, regardless of their differences, all reported the same top challenges: increased regulatory burden, payments innovation, young adult membership growth and small credit union sustainability," wrote World Council President/CEO Brian Branch and Chair Grzegorz Bierecki in their annual report.

In response, World Council continued its work building a global community full of opportunities to share effective strategies and lessons that tackle these global challenges, the pair wrote.

Those efforts included:
  • For regulatory burden, helping defend credit unions in front of international standard-setting bodies;
     
  • For payment innovations, assisting credit unions incorporate shared-mobile technology platforms;
     
  • For young membership growth, conducting workshops, webinars and educational sessions to develop and share best practices for credit unions to effectively reach younger generations; and
     
  • For small credit union sustainability, helping develop collaborative solutions for credit unions such as procuring shared back-office systems and payments platforms.
The Credit Union National Association is preparing to welcome the 100 millionth U.S. credit union membership this summer.  In fact, credit union members can join in the spirit of fun and show "what 100 million looks like" by sending selfies of themselves and corresponding credit union stories to www.americascreditunions.org, as part of a campaign to highlight the industry milestone. (See the resource link.)

N.Y. young professionals take voice to Hill

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ALBANY, N.Y. (7/22/14)--For the second straight year, the Credit Union Association of New York will include members of the its Young Professional Commission in visits with lawmakers on Capitol Hill.
 
The inclusion of the 35-and-under credit union group is part of the association's role in mentoring the credit union leaders of tomorrow, Mike Lanotte, CUANY senior vice president/general counsel, told News Now . "We believe that it's our obligation to foster the growth of the next generation of credit union leaders and the core offerings of the Credit Union Association of New York."

"We recognize this group should be part of these events, and we're happy to provide the venue for them to do that," Lanotte added. "Over the course of the last few years, since the Young Professional Commission came into existence, this group has been part of the association's governmental affairs conference, and CUNA Governmental Affairs Conference and the advocacy efforts associated with those events, so we thought they should be part of this event as well."
 
After arriving at Credit Union House early Monday afternoon, the advocates, joined by Lanotte and Alison Barna, CUANY vice president of member services and foundation, were briefed by staff from CUANY and Credit Union National Assocation on pressing legislative topics. Following the briefing, the group had visits scheduled with Sens. Charles Schumer (D) and Kirsten Gillibrand (D), both of New York.
 
Today, the group also has visits scheduled with Paul Tonko (D), Louise Slaughter (D), Brian Higgins (D), Bill Owens (D), Richard Hanna (R), Daniel Maffei (D),  Chris Gibson (R), Chris Collins (R) and Tom Reed (R), all of New York.
 
The advocates include:
  • Kayla Barber, Dannemora FCU, Plattsburgh, with $141 million in assets;
  • Angela Hitchcock, Sidney FCU, with $385 million in assets;
  • Meghan McGee-Pelkey, UFirst FCU, Plattsburgh, with $57 million in assets;
  • Cristina Morrissiey, AmeriCU CU, Rome, with $1.2 billion in assets;
  • Jennifer Preston, Reliant Community FCU, Sodus, with $376 million in assets;
  • David Roy, Buffalo Metropolitan FCU, with $90 million in assets; and
  • Brittney Wensley, Sunmark FCU, Latham, with $404 million in assets.
Among the topics the group will address with lawmakers are data security, patent reform, exam fairness, member business lending, supplemental capital and Regulation D.

Other states participating in Hike the Hill visits this spring and summer include Michigan, Minnesota, Maine, Missouri, New Mexico, Arkansas, Oklahoma, Texas, North Carolina, South Carolina,  Nebraska, Ohio, Iowa,  Oregon, Washington, California, Nevada, Alabama, Florida, Wisconsin, Georgia, Kentucky, Montana, Massachusetts, New Hampshire and Rhode Island.

Consumers stashing cash in checking accounts: Moebs

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LOS ANGELES (7/22/14)--U.S. consumers are keeping their cash in checking accounts at a higher rate than at any time in the last quarter-century, according to report from the bank consulting firm Moebs Services Inc. ( Los Angeles Times July 17).

The Moebs report found that the average checking account balance across the country was $4,436 at the end of 2013, more than double the average seen over the last 25 years.

When the economy was booming prior to the recession in 2008, checking accounts had dropped to an average of about $788, according to Moebs.

"When times get difficult, the consumer sits things out and checking balances get larger, normally upward (of) $3,000 or a bit beyond," the study said ( Los Angeles Times ).

For credit unions, share draft accounts also have seen increases of late. In May, share draft accounts made up 14.2% of a credit union's savings portfolio, a 0.7% year-over-year increase and nearly a 4% jump since 2008, according to the Credit Union National Association's June credit union estimates report.

This trend may reflect that consumers and credit union members are still wary of the economy and of their own finances.

"If the economy is doing well as measured by low unemployment and moderate-to-low inflation and prices, then the average balance in the consumer's checking account falls to about $1,400," the report said ( The Washington Post July 18). "If the economy really heats up, then, in 2007 for example, the balance can fall below $1,000 since household revenue is doing well and need for liquidity is just a paycheck or two away."

While consumers may be holding onto cash to stave off overdraft fees or to meet minimum balance requirements, Moebs believes consumers are actually stockpiling cash to build up an emergency fund in case of future difficult financial times.

"They're saying, 'Let's be cautious; let's not use all of the money,'" Greg McBride, Bankrate.com chief financial analyst, told The Washington Post .

First Tech, OnPoint golf outing raises $408K for CU4Kids

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BEAVERTON, Ore. and MOUNTAIN VIEW, Calif.--(7/21/14)--The second annual Dave and Dan Classic, presented by First Tech FCU and OnPoint Community CU, raised a record $408,000 for Credit Unions for Kids, which benefits Children's Miracle Network Hospitals.
 
The tournament took place at The Reserve Vineyards and Golf Club in Aloha, Ore., July 14.
 
The golf tournament was created under the leadership of Tom Sargent, former First Tech president/CEO, and is named after NFL Hall of Fame inductees Dave Wilcox and Dan Fouts. This year's edition featured 28 celebrity guests including fellow Pro Football Hall of Famers Ronnie Lott, Mel Renfro and Kellen Winslow.
 
"This tournament would not have succeeded without the support of our corporate sponsors, credit unions, volunteers and friends of the Children's Miracle Network Hospitals," said Greg Mitchell, president/CEO of First Tech CU, Mountain View, Calif., with $6.6 billion in assets. "Through the years, the tournament has not only given credit unions the chance to collaborate, but to also make a meaningful impact in the lives of others by helping children get out of hospital beds and onto the playground. I'm proud to say we've raised more money this year for Credit Unions for Kids than ever before."
 
Formerly known as the "Hank and Moose Open," the tournament has raised more than $3 million during the past 14 years to become one of the biggest credit union-sponsored events supporting Credit Unions for Kids, a nonprofit organization under which America's credit unions raise funds for Children's Miracle Network Hospitals.
 
"The Dave & Dan Classic is an outstanding event and the money raised is a huge benefit to Credit Unions for Kids," said Rob Stuart, president/CEO of OnPoint Community CU, Portland, Ore., with $3.4 billion in assets. "We firmly believe in the credit union philosophy of 'people helping people' and this is one example of how credit unions come together to give back to our communities. We are proud to be involved and support Children's Miracle Network hospitals and the children and their families who benefit from their care."
 
Said John Lauck, president/CEO of Children's Miracle Network Hospitals: "Our credit union partners never cease to amaze us, and First Tech and OnPoint are no exception. I am honored to be involved with the Dave and  Dan tournament and grateful for the generosity that allows our member hospitals to provide life-saving care to local kids. Donations from this event will directly impact families in the First Tech and OnPoint communities by funding pediatric rehabilitation treatments and cancer research among other critical services, equipment and charitable care."
 
Tournament proceeds benefit several children's hospitals including the Doernbecher Children's Hospital, Portland, Ore.; Sacred Heart Medical Center, Eugene, Ore.; Seattle Children's Hospital; Oakland Children's Hospital, Oakland, Calif.; and UC Davis Children's Hospital, Sacramento, Calif.

Affinity FCU: No fat cats allowed

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BASKING RIDGE, N.J. (7/21/14)--One thing's for sure, when a credit union attacks a bank--an unusual reversal of roles--it's much more humorous.

Affinity FCU, Basking Ridge, N.J., recently rolled out an ad campaign with a fat, selfish cat as the protagonist--a big bank CEO-like kitty who's only concerned with making himself more money at the expense of consumers ( Mashable.com July 18).



In the TV ad, the fat cat asks two advisers rhetorically why they've gotten into banking in the first place.

"We did it to make lots of money so we can afford the Deluxe Kitty Playtime Palace, and this literal mountain of catnip," he answers for them, pointing at both items in his luxurious office.

The idea, the ad's creators say, is to illustrate the stereotypical bank, and remind viewers that credit unions are nothing like that.

As the ad puts it, Affinity is "100% fat cat free."

Tom Christmann, chief creative officer for the ad agency who developed the campaign, DiMassimo Goldstein, puts it another way.

"We wanted to personify that big bank mentality in a way that people would respond to," Christmann told Mashable . "So we thought, 'cat video' plus 'I hate banks' equals 'fat cat,' which might be the algorithm for a viral video."

A second ad in the series will hit airwaves later this summer featuring the fat cat tossing plants off of his desk in a wasteful manner. In addition to cable TV spots, the New Jersey-based campaign also features billboards and will extend to social media, online banners and YouTube.

Also, cat lovers needn't worry, as the star of the campaign isn't really fat, but is wearing a custom-made fat suit. He's also not greedy.

"He's the Robert DeNiro of cats," Christmann said. "He's the sweetest guy."

CU System briefs (07/21/2014)

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  • LANSING, Mich. (7/21/14)-- Michigan Gov. Rick Snyder bestowed the 2014 Corporate Community Leader award on American 1 CU, Jackson, Mich., with $272 million in assets. The award, one of the Governor's Service awards, honors businesses that demonstrate excellent corporate citizenship by giving back to their community ( Monitor July 17). In 2013, American 1 CU's donations and sponsorships totaled more than $100,000, and it hosted 12 annual events, the proceeds from which go to local nonprofits. The credit union also offers a scholarship program for high school seniors in which credit union members donate $25 to skip one month's loan payment. Last year, 15 $1,000 scholarships were awarded to local students. Snyder, second from left, presents the Corporate Community Leader award to board member Terry Krieg, with Mary Culler, director of governmental affairs, Ford Motor Co., left, and Carolyn Bloodworth, board chair, Michigan Community Service Commission, flanking Snyder and Krieg (Michigan Credit Union League Photo) ...
     
  • ST. PAUL, Minn. (7/21/14)-- The Minnesota Credit Union Network is offering young credit union professionals an opportunity to crash its Fall Leadership Conference Sept. 5-7 in Brainerd ( The Pulse July 16). Members of the league's Crew-- a group of credit union professionals under age 35--will receive an exclusive discounted package, while a limited number will receive a complimentary conference registration ...

Columbus publication shines spotlight on Ohio's Mercer

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COLUMBUS, Ohio (7/21/14)--Ohio Credit Union League President Paul Mercer sat down with Columbus Business First recently as part of the publication's "People to Know" series on banking, where he fielded various questions about the state of the credit union movement.

Questions ranged from how Mercer got involved with credit unions to how to attract new members to the movement, but much of the conversation centered on the impact that recent decisions made by U.S. lawmakers have had on credit unions.

"How will the Dodd-Frank Wall Street Reform and Consumer Protection Act affect the businesses and individuals who are your clients?" Mercer was asked.

While the legislation was created with good intentions, Mercer answered, "For credit unions, Dodd-Frank is the latest contribution to a serious real-world, street level, Main Street problem: Federal government overreach and regulation is a large and growing cost, burden, limitation and distraction for smaller, community-centered financial institutions such as credit unions and community banks."

When asked about too-big-to-fail banks, Mercer said: "One travesty of financial markets reform is that (the) government took a big swing at the real problem--Wall Street excess, real systemic risk--but mostly missed and landed a blow directly on the chin of smaller financial market players.

"More good intentions leading to laws and rules yielding unintended consequences," he said.

In addition to Mercer, Michael Shafer, CEO of Pathways Financial CU, Columbus, Ohio, with $223 million in assets, will be interviewed for the series.

Patelco: Slashing 39 fees dismantles service barriers

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PLEASANTON, Calif. (7/21/14)--Thirty-nine member service fees erased. Balance transfer: gone. Card replacement: gone. Early mortgage payoff: gone. It's all part of $4.1 billion-asset Patelco CU's mission--to remove any barriers to creating a great experience of banking for its members. And it's a mission driven by Erin Mendez as she closes in on her first anniversary of being president/CEO of the Pleasanton, Calif., credit union.
 
"We are returning Patelco to its roots of being a credit union that stands behind the credit union member and does what's best for the member," Mendez told News Now .
 
"The majority of our members are just middle-class people from all walks of life," she said. The fees--which created a "bill environment"--were a nuisance to members and to the staff tasked with collecting them.
 
The one fee that has been most obvious to members is the plastic card replacement fee, Mendez said. The credit union's branches are equipped with instant issue systems for ATM, credit and debit cards, which means no mailing costs. "That's the one members say, 'Oh my gosh, thank you,' when we can hand them their new card without charging them," Mendez said.
 
Some might wonder how Patelco will recoup the $800,000 reduction in fee income. Mendez said it will be balanced by deepening the relationships with their members. "We believe in 'banking on trust'--we won't nickel and dime our members," she said.
 
"To me it's critical to have enriched our members' lives and provide them with service and value," Mendez told News Now . "We are rallying to do the right things for the members."

CFPB's Cordray meets with El Paso area CUs

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FARMERS BRANCH, Texas (7/21/14)--Representatives from the Cornerstone Credit Union League and a group of El Paso-area credit unions last week met with Consumer Financial Protection Bureau (CFPB) Director Robert Cordray and his staff to discuss the impact on credit unions of recent regulatory changes by the agency.
 
The forum was part of several roundtables in the El Paso area with different groups to discuss issues pertaining to the CFPB's operations ( Leaguer July 18).
 
 Several credit unions indicated that they would continue to write non-QM loans because members are unable to qualify for loans under the QM rules. Cordray expressed support for non-QM loans, as many lenders have shifted to only issuing QM loans due to perceived risks.
 
 Cordray also addressed remittance transfers, and how the CFPB believes misinformation about the new requirements convinced many smaller entities to leave the market.  Several of the credit unions indicated that they no longer provide remittance services as a result of the rule, due to vendor issues and possible risk in the error resolution process.
 
Much of the discussion centered on "pain points" created by the implementation of the Dodd-Frank Act, especially the new ability-to-repay and qualified mortgage (QM) rules. Cordray asked about specific staffing issues at each credit union, and how staffing changes were incorporated into operations. 
 
Cordray expressed confidence that credit unions could continue to provide remittances under the new rule, and would lend the CFPB's assistance in working with vendors to fix remittance issues.  He stressed the importance of financial service providers participating in the remittance process. Their departure might force members to look to less reliable services for remittances, he said.
 
Overall, Cordray praised credit unions for their efforts in assisting low-income consumers, especially those in the El Paso area. He encouraged credit unions to continue to be a market leader in providing short-term, small-dollar loans as a preferred alternative to predatory payday lenders. With the CFPB assuming regulatory authority over nonbanking entities, including payday lenders, he also asked that credit unions partner with the CFPB in reporting any abusive practices by these companies.

LSCU shows Costa Rican CUs advocacy in action

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BIRMINGHAM, Ala., and TALLAHASSEE, Fla. (7/21/14)--A contingent of 10 officials from five Costa Rican credit unions and FEDEAC, the Costa Rican credit union trade association, gained insight on effective lobbying and formulating a unified message during a four-day visit with  the League of Southeastern Credit Unions (LSCU) in Tallahassee, Fla.
 

The Costa Rican visitors also toured the state Capitol, met with the governor's staff and toured three Tallahassee area credit unions.
 
During the visit to the Florida Capitol, the league showed Costa Rican credit unions how the committee process works and then how the final vote takes place on the floor. While meeting with Gov. Rick Scott's staff, the credit union officials toured the lieutenant governor and governor's offices. They met with Scott's Director of Legislative Affairs Darrick McGhee to learn more about the governor's priorities, the issues facing the state and how the league interacts with government offices.
 
"The league really wanted to give our Costa Rican credit union partners an upfront look at how we lobby our state lawmakers," said LSCU President/CEO Patrick La Pine. "By showing the Costa Rican officials how we formulate our messages and then having them go to the capitol to see how the process ties together, they gain a better understanding of how a unified message can influence policy."
 
Discussion during the visit included how the league interacts with the Legislature on behalf of credit unions, how it organizes grassroots campaigns and how it taps credit unions to assist in the lobbying process--all practices the Costa Ricans were looking to bring back to their country.
 
The three credit unions the group visited were: Tallahassee-Leon FCU, with $43 million in assets; First Commerce CU, with $400 million in assets; and Envision CU, with $279 million in assets. Each stop gave the Costa Rican credit unions an opportunity to see how each credit union takes part in advocacy on the state and national level. Costa Rican credit unions were interested in the U.S. credit unions' technology, specifically mobile banking and remote deposit capture.

 
Click to view larger image During four day of meetings with League of Southeastern Credit Union, a contingent of Costa Rican credit union representatives meet with members of Florida Gov. Gov. Rick Scott's staff. (League of Southeastern Credit Unions Photo)

CU marketer offers advice on leveraging social media

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FARMERS BRANCH, Texas (7/18/14)--Even if credit unions have embraced the fact that marketing to new members must include a social media strategy, for many the question remains how to develop the most effective and engaging campaign.

Social media has armed consumers with a voice and with more power than they've ever had, Melissa Herrington, Garland County Educators FCU, Hot Springs, Ark., with $3.5 million in assets, recently told Cornerstone Credit Union League magazine Perspectives ( Leaguer July 17).

Now, modern marketers have the task of deciphering how to leverage that development into growing their brands and influencing consumer behavior, she said.

"While there are many factors to consider when building a social media strategy, if credit union marketers view social media through a philosophical lens, that is, if they choose strategies that play to their strengths in an effort to be authentic to their membership base and to the ideals of the movement, (consumers) will be more apt to 'like' and 'share' in their marketing efforts," Herrington said.

To engage an audience through social media, Herrington suggests the following ideas:
  • Publish content specific to select employee groups that's informative, entertaining and educational. "Remember, it's not about you, it's about how your products and services can make your members' lives easier and help them become owners of their financial futures," Herrington said.
     
  • Recruit loyal members to be ambassadors for the credit union and ask them for input on social media content development. If they're invested in a meaningful and authentic way, Herrington says, they will be more likely to take ownership of the process and spread the word about the credit union.
     
  • Share the message that credit unions are different from other businesses, and explain how.
"The modern marketing strategy is to create content for specific groups of people so that when they see it, it not only resonates, but motivates them to take action," Herrington said.

Minn. foundation fits fast feet to fin. lit.

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BLOOMINGTON, Minn. (7/18/14)--The Minnesota Credit Union Foundation (MCUF) is taking steps to improve financial literacy in the state of Minnesota. As part of that effort, the foundation recently asked supporters to take steps as well: five kilometers-worth of them.

The Minnesota Credit Union Foundation's Financial Literacy 5K helps raise awareness for financial education. The inaugural race was July 12 at Lake Normandale in Bloomington, Minn. (Minnesota Credit Union Foundation Photo)
Nearly 300 people participated in MCUF's inaugural Financial Literacy 5K, held in Lake Normandale in Bloomington, Minn. The event, which featured a walk/run for adults and a half-mile run for kids, included awards for first-place male and female finishers, and for the top three male and female finishers in six age categories.

Credit unions, schools and organizations who registered five or more participants were eligible to win the team award, which will be announced this month.

"Hosting this 5K event raises awareness of the need for consumers to have greater knowledge and understanding of money management," said Pat Brekken, MCUF chair. "The strong turnout today highlights the key role that credit unions play in improving the lives of the members and communities they serve."

Added Kristina Wright, MCUF executive director: "Our efforts as a foundation are small compared to the time and energy that our state's credit unions dedicate on an ongoing basis to providing personal finance education to members, students and members of the community."

CU System briefs (07/18/2014)

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  • MIDDLETOWN, Pa. (7/18/14)-- Mid-Atlantic Corporate FCU, Middletown, Pa., is holding fast to a resolution for 2014 to raise money and awareness for Children's Miracle Network Hospitals (CMN Hospitals), their patients and their families . This year, Mid-Atlantic Corporate planted a community garden with the intent of selling the produce to employees and donating all the funds to Penn State Hershey Children's Hospital. The garden will be tended by the corporate's employees. Mid-Atlantic Corporate FCU also has joined CMN Hospitals for the annual egg hunt at Hershey Stadium, Children's Miracle Network Telethon and Chocolate Miracle 5K Race. Nine of Mid-Atlantic Corporate's employees participated in this year's Egg Stuffing Party, in which they helped The Hershey Co. stuff Easter eggs for its annual egg hunt to benefit CMN Hospitals at Penn State Hershey Children's Hospital. On June 21, Mid-Atlantic Corporate employees collected shoe tags from runners at the Chocolate Miracle 5K Race finish line to record their race times. The proceeds from this event went to Penn State Hershey Children's Hospital. All told, Mid-Atlantic Corporate has raised $12,492.81 for CMN Hospitals in the first half of 2014 ...
  • RICHLAND, Wash., and ROME, N.Y. (7/18/14)--Two credit unions recently lent assistance to local organizations that were in financial need. Richland, Wash.-based Gesa CU, with $1.3 billion in assets, pledged matching funds of up to $15,000 to keep two local crisis centers open, the Northwest Credit Union Association reported ( Anthem July 15). The local community also donated more than $38,000. With the credit union's matching gift, more than $53,000 has now been raised. The campaign is for the continued operation of the Safe Harbor Crisis Center and My Friend's Place Teen Shelter in Kennewick. In New York state, Rome Teachers FCU donated $5,000 to help the Rome Rescue Mission meet a budget shortfall of $28,000 . John Vero, board president of the $33 million-asset credit union, told the Utica Observer-Dispatch that the decision was an easy one (July 15). "We know they feed thousands of people and provided approximately 40,000 meals for people throughout this year, and they provide education and job support for their clients, the majority of which are single women," he said ...
    ...

Virtual cash becomes reality with Grow Financial's money machine

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TAMPA, Fla. (7/18/14)--Standing inside a gusty money machine booth trying to snatch dollar bills out of thin air can be pretty difficult. Even more so when the money isn't real.

Grow Financial FCU's Virtual Money Machine brings an interactive aspect to a cash-grab at its new location in local mall after moving from the Tampa, Fla.-based credit union's main branch. (Grow Financial FCU Photo)
Grow Financial FCU's Virtual Money Machine, which captures the fun of the real version of the money-grab game in a digitally simulated form, was recently relocated from the Tampa-based, $2 billion-asset credit union's main branch to a local mall, where even more people, including nonmembers, can try it out.

"By placing this large-scale kiosk/ATM in a mall, it not only serves a functional purpose, but also acts as a great marketing platform," said Steve Birnhak, CEO of Inwindow Outdoor, the New York-based company that developed the machine.

The virtual money kiosk, which doubles as an ATM, is driven by an "augmented reality, motion reactive video mirror" that features six touch-sensitive, high-definition screens.

Both members and nonmembers can play the virtual money-grab game. Participants can win $25 toward a checking account, $100 toward an automobile loan and $300 for a mortgage loan.

"Grow Financial wanted to incorporate technology in a way that would be both exciting and engaging, which is not something you typically encounter with financial services companies," Birnhak said. "The virtual money machine is a terrific example of a company reaching its audience in an entertaining way that can result in new customers before they walk in the door."

#100MM campaign starts conversations between members, CUs

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MADISON, Wis. (7/18/14)--As more faces are being added to the americascreditunions.org gallery of 100 million memberships, credit unions and their members are chatting via social media about their relationships.
 
In a social media conversation, staff at TTCU, Tulsa, Okla., thank Heidi, a member of the $1.4 billion-asset credit union, for submitting her story and selfie to www.americascreditunions.org, which is cataloguing 100 million credit union memberships. (TTCU Photo and CUNA Photo)
The "100 Million Credit Union Memberships" project is inspiring credit union members to share how long they have been a member of their credit union and what makes their credit union special.
 
While many people cited decades of membership, a unique answer came from a member of $2.2 billion-asset Coastal FCU. Larry Apple tweeted that the passbook number on his original membership card is 59--a number that likely came from the first couple months of operations, the Raleigh, N.C., credit union responded in a Twitter conversation.
 
The #100MM hashtag is shorthand for the upcoming milestone of 100 million memberships at U.S. credit unions, captured by the www.americascreditunions.org website from the Credit Union National Association and the state credit union leagues. Leagues have been encouraging participation with newsletter articles and dedicated pages on their websites.
 
Members can share submitted selfies with the hashtag #100MM on Google+, Facebook, Instagram and Twitter.
 
To upload a video or photo, just visit the 100 million memberships website, complete the form, upload the image or video from your computer (or via social media) and submit.

N.Y. CUs collaborate on robbery prevention

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ELMIRA, N.Y. (7/18/14)--Several New York state credit unions recently collaborated to turn one of the most traumatic experiences of working at a financial institution--robbery--into an example of friendship and support.
 
In the aftermath of two robberies last year, Bob Mace, president/CEO of Finger Lakes Health Care FCU, Elmira, with $24 million in assets, decided to make structural changes to make his branch safer, the Credit Union Association of New York reported ( The Point July 17). In total, new bulletproof glass, camera systems and steel-enforced doors cost the credit union more than $40,000--a significant, but necessary cost, according to Mace. "We had to ensure the safety of employees and our members," he said.
 
Mace also had the support of his local credit union colleagues. "After our robberies, I immediately heard from our fellow credit unions inquiring about our well-being and offering to help in any way," he said.
 
Unbeknownst to Mace and the staff at Finger Lakes Health Care FCU, several other area credit unions--ServU FCU, Painted Post, with $246 million in assets; First Heritage FCU, Painted Post, with $297 million in assets, and Corning FCU, with $1 billion in assets--had begun collecting donations to help offset the costs Finger Lakes Health Care FCU incurred in upgrading its facility. In a matter of weeks, the three credit unions were able to raise $10,500, which was then donated during a surprise visit to Finger Lakes Health Care FCU's Elmira office.
 
"One positive aspect of our two recent robberies is that you surely find comfort in the kindnesses of others," said Mace. "In our case it's been the remarkable involvement and camaraderie of our fellow credit unions."
 
Kenneth Peworchik, Finger Lakes Health Care FCU board chairman, added,"Makes me proud to be associated with the credit unions of our area."

Choosing CU membership helped immigrant achieve his dreams

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MADISON, Wis. (7/18/14)--Daman Davila, a staff writer reporting for Wise Bread , a community of bloggers that helps consumers "live large on a small budget," offered "9 Good Reasons to Choose a Credit Union Instead of a Bank" in a recent post.
 
Davila shared his personal experience. "I am huge believer in credit unions," he wrote. "When I first arrived to the U.S., I only had my savings and my dreams of completing an MBA degree. As an immigrant I didn't have a credit history or a U.S. bank account. This meant that many big names in banking were hesitant to give me a chance. This made qualifying for a credit card or becoming eligible for a car loan very challenging. Thanks to a local credit union, I was not only able to achieve these milestones, but also build my credit history and become financially independent."

Here are the reasons Davila cited to choose a credit union instead of a bank:
  • Credit unions have owners. As owners of their financial institutions, credit union members have a say in how the organization is run. Credit unions--and all cooperatives--are governed by a one-member, one-vote rule. Also, when a credit union makes a profit, it is used to provide better opportunities to the community that it serves.
  • Accounts have fewer and lower fees. "Unlike big banks, credit unions aim to minimize account fees," Davila wrote. "For example, credit unions are well known for not charging monthly maintenance fees, which are about $12 to $14 at big-name banks."
  • Clerks talk with you. Credit unions are known for providing personal service, Davila wrote. "For example, in my first year I miscalculated an incoming paycheck and wrote a check that was $10 over my balance," he explained. "Instead of charging me an overdraft fee, a rep from my credit union gave me a call. He asked me if I could make a deposit to cover the $10 difference. Also, my credit union gave me a one-time overdraft fee waiver because they understood that it was a rookie mistake."
  • Lower financing costs and higher payouts. Data from the National Credit Union Administration consistently shows that credit unions outperform banks. For example, in March, credit unions had a national average rate of 4.75% for home equity loans, while banks had a 5.33% average rate. A $2,500 money market investment would have paid an average 0.16% at credit unions and an average 0.12% at banks. A $10,000 5-year certificate of deposit yielded a national average of 1.32% at credit unions, 1.14% at banks.
  • Access to financing for low-income individuals. Credit unions do not only offer cheaper financing options, but also provide low-income or financially distressed individuals a chance to qualify for financing.
  • Friendly credit card terms. Credit unions are well-known for providing some of the most attractive credit cards, no annual fees,  no introductory rates and low annual percentage rates. "My very first credit card was through my credit union and I still keep it until this day," Davila wrote. "I have not been able to find a credit card that matches the great terms that my credit union offers."
  • Car loans. As of March 2014, a 48-month new-car loan stood at a national average of 2.69% at credit unions, and of 4.94% at banks. For 48-month used-car loans, the average rate was 2.87% for credit unions, 5.48% for banks.
  • Private lines of credit for college students. Some credit unions partner with private student-loan providers to offer lines of credit to supplement college education costs.
  • Christmas and club savings accounts. Savings club accounts help members set aside money on a monthly basis, and then withdraw it at a certain time for big expenses. Some banks offer savings clubs, but consumers are more likely to find them at credit unions, because the accounts aren't designed to generate profits ( News Now March 6).

Grants from CUs help schools, teachers make the grade

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MADISON, Wis. (7/17/14)--Students may still be on summer vacation, but credit unions are helping teachers and schools prepare for the upcoming school year with financial support for programs, training and infrastructure.
 
In New York, students from 61 schools submitted videos for Municipal CU's Build a Better School contest ( New York Daily News June 23). The $2 billion-asset credit union granted $5,000--matched by another $5,000 from the United Federation of Teachers (UFT)--to four schools for a greenhouse, a weather station, computers and science lab equipment.
 
The largest grant of $10,000--also matched by the teachers' union--went to School by the Sea, Far Rockaway, Queens, where $20,000 will help fix classrooms destroyed by Superstorm Sandy.
 
"We judged them on the basis of need, creativity, collaboration and community," Corey Fernandes, Municipal CU vice president for business development, told the N ew York Daily News .  
 
Build a Better School, which will accept grants next year, was sponsored by Municipal CU, the New York City Department of Education, UFT, the Council of School Supervisors and Administrators, the City University of New York, WPIX-TV 11 and the Daily News .
 
Moss Point (Miss.) High School chemistry and physical science teacher Myeshea Holmes, left, and department Chair Qwantina Barlow are using the grant from Singing River FCU to restore a greenhouse that will ultimately house a produce market. (Mississippi Credit Union Association Photo)
In Moss Point, Miss., Singing River FCU awarded three $1,000 grant to local teachers because they are "dedicated, passionate teachers," said Jimmy Smith, president/CEO of the $196 million-asset credit union ( CU Connection July 9). "They're also spearheading innovative projects that will inspire students and parents alike, with no additional dollars in their budgets."
 
Kelly Walters, who teaches third grade at Martin Bluff Elementary School, will invest in technology that will allow her students to write and publish interactive digital textbooks.
 
Myeshea Holmes, a chemistry and physical science teacher at Moss Point High School, will team up with the school's carpentry department to restore a neglected greenhouse on the campus in order to establish a new gardening program. Eventually, Holmes said, "we'll open a produce market run by our business students and sell fresh vegetables to the public."
 
Mississippi's history and natural resources will be the focus in Sharon Thompson's classroom at Central Elementary School. The "Rockin' Round Mississippi" curriculum will allow students to celebrate Mississippi natives such as Oprah Winfrey, Brett Favre and Elvis Presley.
 
"Every student understands and remembers in his own way, and this material allows for learning across multiple intelligences," said Thompson, a special education inclusion teacher.
 
The A+ Education Foundation, a philanthropic arm of $1 billion-asset A+ FCU, awarded more than $72,000 in grants to 81 educators in central Texas. Since 2004, the Austin, Texas-based foundation has awarded more than $500,000.
 
The grants cover the cost of programs, supplies and training to improve the classroom experience for students. This year's winning submissions include a literacy lab, college readiness, music in play, circuitry in engineering, integrating technology to foster and develop mathematics and assistive technology to conquer dyslexia.
 
"We continue to be impressed by the innovative and creative grants submissions we receive each year," said foundation President Kerry A.S. Parker.

CU invests in staff, community with paid volunteer time

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ST. LOUIS (7/17/14)--Leaders from 1st Financial FCU, Wentzville, Mo., have a long list of ways to encourage employees to give back to the community, such as offering opportunities to donate goods, provide financial literacy education and participate in fundraising efforts.

That list just got a little longer.

The $203 million-asset credit union in the St. Louis-area recently introduced a paid-volunteer program where it pays employees when they volunteer at designated nonprofit organizations in their communities ( St. Louis Post-Dispatch July 11).

In order to bring about true life-changing transformation in the community, the credit union's leadership says, it takes hard work, effort and people using their talents and skills for good.

"Paid volunteerism is such a great opportunity to allow our employees the chance to actively contribute to the communities we serve," said Robyn Whalen, 1st Financial vice president of human resources and administration. "We don't just donate money or raise funds for our local charities. We physically help those organizations whether it's stocking shelves at a food pantry, playing with children in a shelter or building a house."

So far, employees from 1st Financial have worked more than 165 hours of paid volunteer time at organizations such as Gateway 180: Homelessness Reversed; O.A.S.I.S. Food Pantry; PAKT Community Center; and Habitat for Humanity of St. Charles County.

The organizations are picked through the credit union's Helping People 1st grant program.

"The act of volunteering is a team- and morale-building event," Whalen said. "The employees create shared memories and work together to help a good cause."

CU System briefs (07/17/2014)

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  • WESTBROOK, Maine (7/17/14)-- Lauren Reeves, who just completed her stint as the Young & Free Maine "spokester," is the new corporate communications and marketing coordinator for the Maine Credit Union League. Reeves will replace Diana Dionne, who will be leaving in the fall after the birth of her twins. "Diana has done a great job during her seven-plus years with the organization," said Jon Paradise, league vice president of governmental and public affairs ...
  • HARAHAN, La. (7/17/14)-- Danielle Thibodeaux has been promoted to compliance director at the Louisiana Credit Union League , where she will assist member credit unions with research and compliance needs ( eNews July 16). Thibodeaux also will help maintain compliance information available through InfoSight and CU Policy Pro ...
  • LAWRENCE, Mass. (7/17/14)-- Lawrence (Mass.) Postal Employees CU, has merged with $510 million-asset Merrimack Valley FCU, Lawrence, Mass. Before the July 1 merger, Lawrence Postal Employees CU was the smallest postal credit union in the United States with $492,000 in assets and 118 members ...

New CUNA eSchool tailors compliance training for HR professionals

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MADISON, Wis. (7/17/14)--The Credit Union National Association announced a new, eight-session eSchool focused on the compliance challenges faced by credit union human resources professionals.
 
The HR Compliance eSchool, which will run between Sept. 3 and Oct. 29, is tailored to keep human resources professionals updated on workplace law and better able to minimize risk.
 
"Human resources professionals sometimes get caught in a difficult balancing act between advocating for the employee and protecting the credit union," said Marlo Foltz, CUNA vice president of blended learning. "Over the course of eight Wednesdays this fall, we'll make sure they have the regulatory updates and compliance know-how to successfully position their credit unions and stay one step ahead in their HR roles."
 
The eSchool will identify and address common pitfalls that can put an organization at risk. Presented by human resources expert Joe Aitchison, each session offers resources for tackling the complexities of workplace compliance.
 
The CUNA HR Compliance eSchool session dates and topics are:
  • Sept. 3: Complying with Fair Labor Standards Act and I-9;
  • Sept. 10:  HIPPA Privacy and Other Workplace Security Issues;
  • Sept. 17:  Social Media in the Workplace;
  • Sept. 24:  Family Medical Leave Act/Americans with Disability Act;
  • Oct. 1:  Department of Labor and Employee Retirement Income Security Act Audits;
  • Oct. 15:  Equal Employment Opportunity Commission Diversity and Affirmative Action Plans/Office of Federal Contract Compliance Programs;
  • Oct. 22:  Harassment, Discrimination and Workplace Violence; and
  • Oct. 29:  Human Resource Audits--The Whats and the Whys.

NW CUs write truly big checks to states' members

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PORTLAND, Ore. (7/17/14)--The Northwest Credit Union Association (NWCUA) created an eye-catching way for its member credit unions to communicate how Washington and Oregon credit unions collectively saved consumers $280 million in the 12 months ending March 2014.
 
Click to view larger image Click for larger view
The NWCUA created downloadable check images that member credit unions can post to market the credit union difference to the public.
 
The two checks are made out to the members of each state and signed by ASmarterChoice.org, the consumer website launched in 2011 by the Credit Union National Association and state credit union associations to provide information on credit unions to potential members and the press.
 
Washington's 3 million members collectively saved nearly $202 million, while Oregon's 1.4 million members saved more than $78 million, according to an analysis by CUNA. The quarterly report is based on data collected by Datatrac and the National Credit Union Administration (NCUA), which tracked fees, loan rates and interest on savings at banks and credit unions ( Anthem July 16).
 
The NWCUA also provides its member credit unions with community impact reports to share with their members that include statistics such as:
  • Ninety percent of the likely Oregon voters polled in January 2013 shared a positive impression of the credit union in their communities;
  • A recent survey of 36 Oregon credit unions--large and small--found they contributed more than $2.4 million in cash and more than 46,000 volunteer hours in 2012 to children's hospitals, food banks, animal shelters and other local charities. Those credit unions also donated nearly $800,000 in staff time to those efforts;
  • The NCUA reported that Oregon credit unions had more than $796 million in outstanding small business loans as of December 2012;
  • Sixty-two percent of Washingtonians are credit union members;
  • Financing a $25,000 new automobile for 60 months at a Washington credit union will save members an average of $231 per year in interest, according to CUNA;
  • A recent survey of 43 Washington credit unions--large and small--found they contributed more than $4.2 million in cash and more than 41,000 volunteer hours in 2012 to children's hospitals, schools, scholarships, food banks and other local charities. Those credit unions also donated more than $1.2 million in staff time to those community causes; and
  • In 1986, a group of Oregon and Southwest Washington credit unions began raising money for local children's hospitals. They were so successful, that their model was adopted nationally by credit unions. Credit Unions for Kids is now the credit union movement's charity of choice, benefitting 170 Children's Miracle Network Hospitals across the United States. Since 1996, Credit Unions for Kids has generated more than $100 million for research, examination rooms and charity care.

Patent abuse among 4 MCUA-backed bills signed by Gov. Nixon

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ST. LOUIS (7/17/14)--Among four bills Missouri Gov. Jay Nixon signed by the July 14 legislative deadline was a measure that provides credit unions and others with protection against bad faith assertions of patent infringement, or patent trolling.
 
Four out of the five bills supported by the Missouri Credit Union Association (MCUA) during the 2014 legislative session will become law on Aug. 28. Nixon vetoed one bill by the deadline. Overall, he vetoed 33 bills, the most in a single year since he took office.
 
House Bill 1374, the patent troll bill, was sponsored by Rep. Stan Cox (R-52). Sen. Mike Cunningham (R-33) introduced Senate Bill 706, which addresses the same issue ( News Now Feb 6).
 
The new law sets clear criteria to help judges distinguish legitimate from illegitimate patent assertions. It also gives businesses affected by patent trolling the option to seek restitution through the circuit court.
 
"Patent troll" broadly refers to people who sue companies, such as credit unions, for patent infringement on often questionable claims in attempt to collect licensing fees.
 
Other bills signed by Nixon include a consumer protection bill banning public employee pension transfers (HB 1217); a bill protecting a credit union's lien priority over a condo association's special assessment (HB 1218); and a credit card processing service contract bill (HB 1270). 
 
Nixon vetoed the electronic lien release bill, HB 1999.  The bill would have allowed a lienholder who files a lien electronically on a motor vehicle or trailer to electronically release the lien.  Nixon's veto letter cited concerns about a drafting error in the bill. 
 
"While it was disappointing to have the electronic lien release bill vetoed, it was a positive legislative session overall," said David Kent, MCUA director of state legislative affairs.  "The governor signed the majority of our priority bills, including the patent troll bill, and these bills will have an impact on credit union operations and service to members."
 
There is still an opportunity for HB 1999 to become law this year.  The Missouri General Assembly can override the governor's veto with a two-thirds majority vote in both the House and Senate.  The veto session will be held Sept. 10.

Post-recession, millennials struggle to save now to survive later, survey says

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CHARLOTTE, N.C. (7/17/14)--The Great Recession taught many hard lessons to American consumers, and that includes millennials.

According to a recent survey by Wells Fargo, 80% of millennials, or those born between 1980 and the early 2000s, say the economic downturn in 2008 showed them they need to save now to ensure they can survive economic problems in the future.

Unfortunately, in many cases this lesson has not led to action, as only 55% report that they've started saving for retirement. Broken down by gender, 61% of males have started saving compared with 50% of females.

"The silver lining of the recession that started over five years ago is that a majority of millennials get that saving is a necessity and even equate it with 'surviving' tough times," said Karen Wimbish, director of retail retirement for Wells Fargo. "But millennial women are starting out their working lives making far less than men, and as a consequence, are saving less and feeling less contentment at the start of their working lives."

The findings are part of the Wells Fargo Millennial Study that polled more than 1,600 adults ages 22 to 33.

Further, about half of all millennials say they're satisfied with the current state of their savings, with only 41% of women reporting satisfaction compared with 58% of men.

The study also found that many millennials continue to struggle with debt, as 42% said debt is their biggest financial concern, with about 40% saying their debt is "overwhelming." Again, males fared a bit better with 45% of women feeling overwhelmed compared with 33% of men.

Student loans are the top source of debt that millennials grapple with, according to the survey, with 29% reporting that it's their strongest concern.

Additional findings:
  • Of those millennials who have started saving, 46% said they are saving 1% to 5% of their income for retirement; 31% are saving 6% to 10% of their income; and 18% are saving more than 10%;
     
  • More than 70% of millennials are confident they will be able to save enough to pay for the lifestyle they want in the future, with women far less confident than males in this category at 63% compared with 80%; and
     
  • Of those millennials not yet saving, 84% say they aren't doing so because they currently don't have enough money.

Check deposits lead upswing in mobile banking

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AUSTIN, Texas (7/17/14)--Credit unions and banks that have been live with mobile check capture for at least 12 months reported a 45% increase in the number of checks processed monthly in the year ending June 2014, according to Malauzai Software, a mobile banking provider.
 
Malauzai's Monkey Insights report highlights key trends in mobile-banking usage  based on data for 180 credit unions and banks covering 3 million logins from 210,000 active mobile users.
 
There has been a 47% rise in the number of consumers depositing checks among Malauzai clients.
 
Year-over-year, mobile banking consumers increased their frequency of usage, Malauzai reported. The average consumer logged in 3.9 times per week in June 2014, a rise of more than 20% from 3.2 times in June 2013. iOS (iPhone and iPad consumers) log in 12% more often than Android users, indicating that usage varies by platform.
 
From July 2013 through June 2014, viewing of account transaction history saw a 4% gain. Internal transfers increased by 8%, and viewing check images also increased by 10%. Consumers are learning to use the advantages of mobile and tablet navigation, as evidenced by the 12% upturn in the use of the finger-swipe feature. 
 
Mobile bill pay jumped 75% in monthly transaction volume, with a 40% spike in the number of consumers paying bills.
 
For credit unions and banks that have offered Picture Pay--through which end-users pay their bills with smart-phone camera images--at least 12 months, transaction volume rose by 34% over the past year. The value of payments processed monthly increased by 44%.

Thirteen CUs to pilot Filene's employer small-dollar loans

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MADISON, Wis. (7/16/14)--Filene Research Institute announced Tuesday that its new small-dollar loan product, which aims to benefit low- and moderate-income workers, will be tested at 13 credit unions and one community bank located throughout the country.

Called the Employer Sponsored Small Dollar Loan, loan amounts range from $300 to $1,500 and are available to workers at their places of business. Loans are based on tenure, rather than the individual's credit score, and the terms last six months to ease the burden on the employee's cash flow, according to Filene.

Loans also aren't reported to credit bureaus.

This product will "create a partnership between employers and credit unions so that we can better support the financial needs of employees, and in turn improve the turnover, tardiness and absenteeism rates for employers since they are often tied to employees with financial stress," said Cynthia Campbell, Filene director of innovation.

The financial institutions participating in the pilot are:
  • Fitzsimmons FCU, Aurora, Colo., with $167 million in assets;
  • CU of the Rockies, Golden, Colo., with $89 million in assets;
  • Denver Community CU, with $264 million in assets;
  • Metrum Community CU, Centennial, Colo., with $57 million in assets;
  • SEFCU, Albany, N.Y., with $2.8 billion in assets;
  • Spring Bank, Bronx, N.Y.;
  • Holy Rosary CU, Kansas City., Mo., with $19 million in assets;
  • Promedica FCU, Toledo, Ohio, with $51 million in assets;
  • Toledo (Ohio) Urban FCU, with $4.6 million in assets;
  • Toledo (Ohio) Metro FCU, with $39 million in assets;
  • Sun FCU, Maumee, Ohio, with $508 million in assets;
  • Commodore Perry FCU, Oak Harbor, Ohio, with $34 million in assets;
  • Cy Fair FCU, Houston, with $199 million in assets; and
  • NorthCountry FCU, South Burlington, Vt., with $447 million in assets.
The product initially was submitted by NorthCountry FCU to Filene's accessible financial services incubator, which is funded by the Ford Foundation.

NorthCountry has already piloted the product and experienced success, prompting the program to be expanded to 14 financial institutions.

Top priority for CUs must be cybersecurity, advises Council white paper

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WESTBURY, N.Y. (7/16/14)--Unless the goal of protecting sensitive data is paramount to a credit union's operation, it's likely not doing enough, according to a new white paper released Tuesday by the CUNA Technology Council.

The paper discusses the importance of financial institutions making cybersecurity a top priority, while also outlining the value of educating members, protecting their information, communicating effectively should a breach occur and understanding cybersecurity laws and regulations.  

Called "Cybersecurity Preparedness: Taming the Shock and Awe of Big Breaches," it's the first white paper in a series of four scheduled for 2014 dedicated to security.  

"These big security leaks show we need to take cybersecurity preparedness seriously and do more," said Kevin Prince, principal technology strategist for D+H Compushare, a CUNA Strategic Services alliance provider. "You'll never be 100% secure, but you have to manage it as carefully as possible with the appropriate tools."

The paper first calls on Bill Podborny, chief security officer of $8.2 billion-asset Alliant CU in Chicago, to describe "cybersecurity preparedness." Podborny believes to be prepared means identifying vulnerabilities, understanding where attacks may come from, taking steps to lessen or eliminate exposure and being prepared to respond to any situation as quickly as possible.

Authors of the paper illustrate how to make cybersecurity preparedness a core function of the credit union with examples of what credit unions are already doing to keep security strong.

At Michigan Tech Employees FCU, Houghton, Mich., with $60 million in assets, for example, leaders have dedicated resources that work specifically to bolster security, an action recommended by many U.S. regulatory bodies.

"At a certain point it makes sense to separate these departments to ensure security resources don't diminish in times when the IT department is fighting for the same resources," said Justin Store, information technology services director at Michigan Tech Employees FCU.

Finally, to strengthen cybersecurity, Prince suggests credit unions should:
  • Realize what they're doing today likely isn't adequate, and won't be adequate tomorrow, as threats are constantly shifting and changing;
     
  • Conduct regular and thorough cybersecurity risk assessments and document the findings;
     
  • Mitigate risks as much as possible;
     
  • Stay on top of current threats and future trends in cybersecurity; and
     
  • Consider outsourcing to a community cloud arrangement for IT cybersecurity.
To download the white paper, use the link.

CU System briefs (07/16/2014)

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  • WARWICK, R.I. (7/16/14)-- The Credit Union Association of Rhode Island presented a $65,000 check to Special Olympics Rhode Island at the Credit Unions of Rhode Island Charity Golf Tournament July 14 ( Daily CU Scan July 15). The check represents the total amount raised this year, bringing the 17-year total to $714,100. Special Olympics Rhode Island Executive Director Dennis DeJesus commended the league's year-round fundraising efforts and credit unions' support of "the concepts of acceptance, inclusion and respect for those individuals with intellectual disabilities." Navigant CU, Smithfield, with $1.4 billion in assets, had the winning team. From left, Joseph Beretta, Navigant CU President/CEO Gary Furtado, Special Olympics Rhode Island athlete Michael Lucca and John McCarthy (Credit Union Association of Rhode Island Photo) ...
     
  • INDIANAPOLIS (7/16/14)-- The Indiana Credit Union League announced a new award program for credit unions that are achieving excellence in four categories: finance and human resources/training; lending; marketing/business development; and operations and technology. The Best Practice Awards entries should consist of a video or presentation of no more than 3 minutes and a 400-word or less description of the strategy, execution, results and flexibility of the best practice. Credit unions will be judged in three asset sizes: less than $100 million in assets, $100 million to $500 million in assets, and more than $500 million in assets. Entries are due Aug. 11 , and winners will be featured during the Chairman's Awards Banquet at the league's annual convention ...
  • PHILADELPHIA (7/16/14)-- American Heritage FCU, Philadelphia, hosted a recent visit by Tom Ridge, former secretary of the U.S. Department of Homeland Security, for a discussion on credit union security and business issues. Pennsylvania Credit Union Association President/CEO Patrick Conway and Credit Union National Association representatives also met with Pennsylvania's former governor. "This was a great opportunity to reconnect with Governor Ridge, who has always been a great supporter of credit unions," said Bruce Foulke, president/CEO of the $1.4 billion-asset credit union. From left, Richard Gose, CUNA senior vice president of political affairs; Ryan Donovan, CUNA senior vice president of legislative affairs; Ridge; Conway and Foulke (American Heritage FCU Photo) ...

Demand drives second ERM institute from CUNA

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MADISON, Wis. (7/16/14)--The CUNA Enterprise Risk Management (ERM) Certification Institute, hosted in collaboration with The Rochdale Group Inc., will be held Dec. 8-11 in Las Vegas, the Credit Union National Association announced Tuesday.

"Enterprise risk management continues to be a major area of strategic focus for credit unions," said Todd Spiczenski, CUNA senior vice president of association services. "We've added a second ERM Institute this year to meet the demand for training on the topic. The Rochdale team's approach to risk will have an even greater impact on the future of the movement as we see fewer credit unions turning to risk management as a survival mechanism and more looking to ERM's role in their ongoing growth."
 
Made possible by collaboration, CUNA Enterprise Risk Management Certification Institute leverages the reach of CUNA with the ERM expertise of The Rochdale Group Inc. to provide credit union executives with risk-management knowledge and the tools to incorporate ERM at their credit unions. Through the insights and advice of Rochdale's ERM consultants, attendees leave with an understanding of their own risk appetite, risk beyond investments and how risk management can drive decision-making at their credit union.
 
At this year's May institute, 81 individuals earned their Credit Union Enterprise Risk Management Expert (CUERME) certifications. Attendees of the December institute will also have the opportunity to be officially certified as credit union ERM experts through the CUERME designation.

Dakotas hit right note with 'Orchestrating the Goodness'

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BISMARCK, N.D. (7/16/14)--Pop on the radio and you may never hear a catchier tune than the one about credit unions written by attendees of the Credit Union Association of the Dakotas' annual meeting last month.

"Regulations, challenges, changes abound / Better ways to serve members must always be found / By collaborating we'll be orchestrating the goodness / Getting better every day, we'll be orchestrating the goodness," the song goes.  

During a general session at the meeting, credit union professionals transformed into lyricists when they were joined by a pair of Nashville songwriters called The Song Team to create a tune that reflected the meeting's theme: Orchestrating the Goodness.

League President/CEO Robbie Thompson said the musicians asked for suggestions from the audience for lyrics and then blended them into the "Orchestrating the Goodness" song.

"They worked with the audience and tried to show how by cooperating and working together and getting different views they were able to create an original song," Thompson told News Now .

While the musicians initially didn't plan on recording a rendition of the song, attendees enjoyed it so much that many asked if they could have a copy of it after the session.

Eventually, The Song Team created the below YouTube video.

Former Pres. Clinton cites Hope FCU's fight against 'bank deserts'

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JACKSON, Miss. (7/16/14)--Hope FCU's efforts to eradicate "bank deserts" in the Deep South were recently recognized in public remarks by former U.S. President Bill Clinton.
 
Speaking on behalf of the Clinton Global Initiative, the 42nd U.S. president cited Hope FCU's commitment to bring financial services to ZIP codes that are served by two or fewer financial institutions.

"Hope FCU made a commitment two years ago, in 2012, to serve people who were in what they call 'bank deserts' in the Deep South where local banks were closing up or not serving low-income working people," Clinton said. "That is emblematic of what we could be doing everywhere to be creating opportunity at the bottom of the (economic) pyramid."
 

Clinton specifically mentioned how Hope FCU opened branches in Utica, Miss., and on the campus of the University of Arkansas-Pine Bluff.
 
Hope FCU has increased its branch network to 23 from seven locations since the onset of the recession in 2008, according to Bill Bynum, president/CEO of the $187 million-asset Jackson, Miss.-based community development financial institution.
 
"Banks are really leaving these communities," Bynum told News Now . "There's a huge need for the services we provide. We're doing everything we can do to respond to that need."
 
That need is indeed great. Of Mississippi's 533 ZIP codes in 2012, 369 had one bank or fewer, the Corporation for Enterprise Development reported. And about 37% of Hope's new members did not have previous banking relationship, Bynum said.
 
Reaching underserved communities is about more than branches. Mississippi also has great stretches of rural areas, which account for lack of access to financial services. To fill that gap, Bynum and Hope FCU have worked to equip and educate new members on mobile branching.
 
"We think that could be a real way to democratize financial services," Bynum said. "People in rural areas are smart enough to know that a smart phone gives them access to the Internet.

"They can text. They can communicate. They can participate in social media, and not have the cost of a landline or a computer. At the same time, so many of them are outside the banking system. We're excited about the potential to put the power of banking in people's hands," he said.

More than half of the credit union's active mobile-banking members live in high-poverty areas, Bynum told News Now . "It's allowing us to reach a population that is woefully underserved," he added.
 
Bynum said his employees have moved beyond helping members with transactions to become real problem solvers. Clinton mentioned this in his remarks, noting that employees helped members get up to speed on mobile banking.
 
"In addition to banks leaving these communities, we've got payday lenders entering at an epidemic rate, so helping people avoid those debt traps is another challenge we face," Bynum said.
 
Another challenge is raising capital to continue the credit union's outreach efforts. "Most credit unions grow organically, but we're very serious about tackling these bank deserts," Bynum said. He said the credit union is about halfway to its goal of raising $20 million in capital and seeks deposits from other sources, including other credit unions. With the additional funding, the credit union can add 15 additional branches and open new accounts for 30,000 consumers, Bynum said, while making more than $500 million in consumer and business loans.
 
In the meantime, Bynum said it was "fantastic" to receive public recognition from Clinton. "He has been a leader in solving huge problems around the world since he left the White House," Bynum said. "For him to highlight Hope as an example of what's possible in serving people at the bottom of the pyramid serves as a challenge for us to keep pushing forward."

Durham museum honors N.C.'s CU history

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DURHAM., N.C. (7/16/14)--At the Durham A-Z exhibit in the Museum of Durham History, every letter tells a story, sometimes a few stories, including the letter C, which stands for ... you guessed it ... credit unions.
 
North Carolina was home to the first credit union in the South--and, of course, there's a story behind that too ( The Durham News July 15). In the early 1900s the farmers in the community of Lowe's Grove were paid just once a year, at harvest time. In need of credit to keep them flush throughout the year, the farmers pooled $29 and partnered with Durham banker and philanthropist John Sprunt Hill in 1916 to open the Lowe's Grove CU.
 
African-Americans also faced challenges in obtaining credit in the Jim Crow South, and credit unions provided an answer in North Carolina. At one point, North Carolina had more African-American-based credit unions than the rest of the United States combined.
 
One of those credit unions was Mount Vernon Baptist Church CU, which continues to serve its 233 members today. Despite having just $191,000 in assets, Mount Vernon CU makes loans to help its members gain access to cars, homes and education. "Their commitment just amazes me," Katie Spencer, the Museum of Durham History's executive director, told the Carolinas Credit Union League ( In the Loop June 19).
 
That credit union tradition of serving minorities lives on today among Durham credit unions, as Latino CU opened in 2000 and grew to 50,000 members and $100 million in assets by 2010. It serves as a model for credit unions serving immigrant populations.
 
Self-Help CU, which opened in 1984 with $77 from a bake sale, also serves as model for other credit unions. Self-Help CU is leader in community development and lending to low-income borrowers. It has provided more than $6.4 billion to 87,000 families, individuals and organizations across the United States.

CUNA annual report details 'outstanding' year for CUs, says Hampel

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MADISON, Wis. (7/16/14)--In its 2013 annual report, the Credit Union National Association traced its steps of success and the steps the credit union movement is taking toward 100 million memberships.
 
"Last year turned out to be an outstanding one for the credit union movement, as we laid the groundwork to protect our tax exemption, delineated a vision for the future, and worked to reduce the regulatory burden," said Bill Hampel, CUNA interim president/CEO. "This report neatly outlines the efforts that the three-tier system of CUNA, leagues and credit unions took together to realize these results, and build for the future."
 
Advocacy programs continue to be CUNA's strength with the "Don't Tax My Credit Union" campaign to protect the credit union tax status, and the more than 4,000 credit union professionals who attended the annual Governmental Affairs Conference.
 
In 2013, CUNA wrote 50 letters to members of the U.S. Congress, testified seven times before six different committees and subcommittees and filed 60 comment letters to a variety of regulators.
 
CUNA also provided support to states challenged by banking associations and pro-taxation legislative language.
 
New communications vehicles such as The President's Report and In the News were added to enhance CUNA's reputation for quality information regarding credit unions, their members and the financial industry at large. National media outlets such as FOX Business , The Washington Post , USA Today , Politico and The Hill regularly cite CUNA experts and research.
 
In the training and development arena, 382,000 courses and exams were completed through CUNA's online training portal, and more than 9,900 professionals attended on-site CUNA events.

Motley Fool explores value of CU credit builder loans

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ALEXANDRIA, Va. (7/15/14)--For as little as $50, consumers and credit union members can now purchase a better credit score, thanks to credit-building loan products that are becoming increasingly more popular at smaller financial institutions.

The personal investment website The Motley Fool posted an exploration of the loan product Sunday.

As explained by the site, credit-builder loans carry low-interest rates and are structured to help borrowers cultivate stronger credit history.

Consumers take out small dollar loans, between $500 and $2,500 for example, and the funds are then placed in a savings account or certificate of deposit.

The consumer then pays off the loan over the next six to 18 months in full, at which point the entire amount is given to the borrower, all for the cost of a few dollars in interest.

For the consumer, the process results in a head start on a savings goal, in addition to an improved credit score. But the financial institution benefits as well.

"Credit-builder loans are a (small) goldmine for banks," The Motley Fool article's author Jordan Wathen said. "The loans carry absolutely no risk for (credit unions), since the loan proceeds are not disbursed to the customer until the loan is paid off."

When deciding whether to utilize the credit-building loan product, Wathen has several suggestions:
  • Take out a credit-building loan in the smallest amount possible, and borrow from a local credit union, which offer the lowest-cost loans. This option can help repair credit at the lowest cost; and
     
  • Consider alternatives such as a no-fee credit card that can also help build credit.

Pew Trusts urges CFPB to ensure safety of prepaid cards

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PHILADELPHIA (7/15/14)--Based on reports it released earlier this year, the Pew Charitable Trusts has urged the Consumer Financial Protection Bureau the (CFPB) to ensure prepaid cards include certain prescribed features to serve as viable alternatives to checking accounts.
 
The features include:
  • No overdraft or linked lines of credit. Pew's survey research shows that consumers are using general purpose reloadable (GPR) prepaid cards to control their spending, ensure that they will not overdraw their accounts and avoid high fees. More than two-thirds (68%) of regular GPR prepaid card users would rather have transactions declined at the point of sale than have the transactions go through and pay overdraft fees.
  • Access to transaction history and limitations on liability. Prepaid cardholders should be protected against liability for unauthorized transactions that occur when a card is lost or stolen or a charge is incorrectly applied, just as users of debit cards linked to a checking account (a requirement known as Regulation E) are, Pew said. Yet, only 38% of cards provide all of these protections for unauthorized transactions.
  • Uniform, concise, and easy-to-read information about terms, conditions and fees. Consumers seeking to purchase prepaid cards should have access to all the important information necessary to make an educated choice before purchasing a card, whether in a store or online, Pew advised the CFPB. A concise and uniform disclosure document that summarizes fees and other important terms would allow consumers to comparison shop and make an informed purchase rather than the "trial and error" process of finding out about a fee or term after using a card.
  • Federal insurance against all losses up to $250,000. Prepaid cards function exactly like checking accounts in most respects and are used similarly by many consumers, Pew said. Federal deposit insurance rules allow card issuers to use pass-through insurance that fully protects consumers by ensuring that deposits to their cards can be reimbursed if the company becomes insolvent. Most card companies have taken full advantage of this and disclose that they have deposited consumer funds in Federal Deposit Insurance Corp.-insured accounts.
  • No predispute binding arbitration clauses. This type of clause prevents cardholders from challenging unfair and deceptive practices or other legal violations in court, impairing individual rights and potentially allowing abuses to spread without legal or public scrutiny.  Such requirements are increasingly common in financial agreements. Of the 66 cards studied, 51 (77%) have contractual clauses that require cardholders to submit to mandatory binding arbitration. Fifty of the 66 cards (76%) also disclose that cardholders are not permitted to participate in class action litigation involving that card.

CU System briefs (07/15/2014)

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  • SAN ANTONIO (7/15/14)-- Steve Hennigan, president/CEO of the San Antonio FCU, with $2.8 billion in assets, has been selected to join the Federal Reserve Bank of Dallas' Community Depository Institutions Advisory Council ( San Antonio Business Journal July 11). The council was formed as part of an initiative by the Dallas Fed to enhance communication and feedback with community bankers. The council provides senior Dallas Fed officials with grassroots information on a variety of topics, including economic and banking conditions, regulatory policies and payments issues. The council is composed of 12 representatives from financial institutions of various sizes in Texas, northern Louisiana and southern New Mexico ...
     
  • FARMERS BRANCH, Texas (7/15/14)-- People's Trust FCU in Houston, with $478 million in assets, has become the 28th credit union to earn the Cornerstone Credit Union League's Juntos Avanzamos designation ( Leaguer July 14). Juntos Avanzamos means "Together We Advance," and this designation is awarded by Cornerstone to credit unions in the region that have successfully completed a rigorous application process that confirms they have the capacity, commitment, and compassion to serve the financial needs of Hispanic families. People's Trust CU has five branches, serving those who live, work, worship or attend school in Houston. Of its 89 employees, 38 are Hispanic and 26 are bilingual. Over the past year, People's Trust FCU CEO Angela McCathran said the credit union has worked extremely hard to earn the Juntos Avanzamos designation. "Being able to fly the Juntos Avanzamos flag will show not only our members, but the general population, just how committed we are to serving the Hispanic community," she said ...
     
  • HARRISBURG, Pa. (7/15/14)-- The Pennsylvania Credit Union Association's membership ratified a bylaw amendment that extends eligibility for Association director terms to four terms of three years each from three terms. Current directors, who have reached 12 years of service by June 1, will not be eligible for this additional term ( Life is a Highway June 14) ...

Va. league, World Council delegates visit Estonia CUs

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LYNCHBURG, Va. (7/15/14)--A delegation of credit union representatives from Virginia spent a week in Estonia recently as part of the Virginia Credit Union League's partnership with the Estonian Union of Credit Cooperatives.
 
Rick Pillow, league president/CEO, led the delegation, which celebrated the launch of a software platform for clearing transactions and providing access for Estonia's small, but growing system of credit cooperatives to the central banking system in Eastern Europe. This has been the signature project of the partnership between credit unions in Virginia, credit cooperatives in Estonia and the World Council of Credit Unions.
 
During a visit to Estonia, representatives from the Virginia Credit Union League attended an Estonian Union of Credit Cooperatives board meeting. (Virginia Credit Union League Photo)
 
The project was spearheaded by Baltic Shared Services, a company formed in 2010 to establish the clearing system. With such access, Estonia's credit cooperatives are better positioned to offer ATM and card services, and eventually expand into online banking. The Virginia league's service corporation is a majority stockholder in Baltic Shared Services.
 
"As cooperatives, we see it as our duty to ensure the credit union movement grows and prospers, and Virginia's credit union system is proud to partner with the World Council of Credit Unions in helping reestablish cooperative financial institutions in Estonia," said Pillow.
 
The delegation, which included representatives from $1.3 billion-asset BayPort CU, Newport News; $2.6 billion-asset Northwest FCU, Herndon; and $676 million-asset University of Virginia Community CU, Charlottesville, also participated in a regional credit union meeting in Tallinn, Estonia, that drew representatives from Lithuania, Latvia, Poland, Moldova and Macedonia. Key topics during the two-day conference included the regulatory environment for Eastern European credit unions, shared branching and payment systems.
 
"The Estonian movement is at something of a crossroads," said Victor Corro, vice president of the World Council's Worldwide Foundation for Credit Unions. "The platform is in place to link Estonia's credit cooperatives to the central banking system, and now it's a matter of marketing that platform to the credit cooperatives. This represents their best chance at moving beyond the 'pencil and paper' way of running a credit cooperative and toward the services most likely to attract Estonia's tech-savvy population, including online banking and card services."

Corro said this also could lead to increased consumer deposits at Estonia's credit cooperatives, in turn, spurring lending and economic growth.
 
While in Estonia, the delegation also visited the Jarva-Jaani Credit Cooperative, which was celebrating its 15th anniversary, and which has the distinction of having tested Baltic Shared Service's transaction clearing platform and being the first to adopt the system.
 
A nation of 1.3 million people, Estonia had a thriving system of credit cooperatives prior to the Soviet occupation of 1940. At its height in 1939, the Estonian movement boasted 184 financial cooperatives and had a 52% market share. Credit cooperatives were again legalized once Estonia regained independence in 1991 after the collapse of the USSR. The first new Estonian credit cooperative was formed that same year.

NFCC survey: Servicemembers could be at risk of fin. abuse

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WASHINGTON (7/15/14)--It might pain citizens to learn that those who put their lives on the line for this country, specifically people serving in the U.S. military, often grapple with various types of financial strife.

A recent survey by the National Foundation for Credit Counseling (NFCC) found that 77% of servicemembers worry about their finances; 55% do not feel at all, or only somewhat, prepared to handle a financial emergency; and 60% had sought out nontraditional lenders to meet financial obligations on at least one occasion.  

"No one should be victimized by financial abuse, particularly (those in) the military," said Gail Cunningham, spokeswoman for the NFCC, which announced it is celebrating Military Consumer Protection Day Wednesday.

"One way to avoid financial abuse is through financial education, as an educated consumer is always a better consumer--one more-equipped to identify fraud or deception and make wise financial decisions," Cunningham added.

To bolster financial literacy within the military community, the NFCC offers the "Sharpen Your Financial Focus" program, which includes "Hands on Banking for Military" materials developed for active and veteran military members that address the unique financial challenges they often face.

"Stressful situations can result in poor choices, with decisions often made out of desperation," Cunningham said. "To avoid this, servicemembers should take advantage of the opportunity to improve their financial skills, thus putting themselves in a better position to face any unplanned financial circumstance that comes their way."

Leading, lagging indicators can help optimize metrics, says CUNA Council white paper

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MADISON, Wis. (7/15/14)--A new white paper from the CUNA Operations, Sales and Service Council explores the need for credit unions to establish metrics to meet growth and service goals.
 
Credit unions must decide which types of performance evaluation tools are most useful to their operations: financial benchmarks, efficiency ratings, branch performance assessments, member satisfaction rankings, call center metrics, transaction rates in key services such as payments, and trends and new approaches in frontline service.
 
Three case studies are offered to provide real-life examples of how credit unions measure and continually improve their operations, sales and service delivery.
 
One case study explores how $12 billion-asset BECU, Tukwila, Wash., seeks actionable data to improve member services.
 
The Net Promoter Score is a key member satisfaction metric at BECU to the point that the metric "is baked into our strategic objectives as part of our long-term plans," said Shane Morris, senior member loyalty manager.
 
Most recently, BECU has used the results of these surveys to make specific improvements in new member enrollment. The credit union's service model is unusual in that most of its facilities do not offer teller services--members who need to make a deposit or withdrawal are directed to ATMs, its two financial centers with teller counters or shared branches operated by other credit unions.
 
BECU's frontline employees now offer an explanation of how members can find the services they need in BECU's network of branches, ATMs, online and mobile services, shared branches, and kiosks at 7-Eleven stores. Staff can even "show and tell" the service options with a "placemat" available on every desk. For members who enroll online, BECU rescheduled its outbound call to welcome then on Day 2 instead of on Day 7.
 
To download the white paper, use the link.

Coast Central donation means new wheels for food pantry

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EUREKA, Calif. (7/14/14)--Coast Central CU, Eureka, Calif., with $1 billion in assets, recently donated $25,000 to the organization Food for People, which operates hunger relief programs throughout Humboldt County.

Food for People, which fights for hunger relief in Humboldt County, received a new set of wheels to deliver food, thanks to a $25,000 donation from Coast Central CU. (Coast Central CU Photo)
The donation helped purchase a cargo van that replaced an aging vehicle the organization used to collect food from grocery stores and farmers' markets, and deliver it to food banks and families in need.

"It is such a relief to have a reliable, high-capacity van that will met our needs now and into the future," said Anne Holcomb, Food for People executive director. "We appreciate the opportunity to partner with CCCU and the many businesses and farmers who donated over a half a million pounds of food last year in support of our programs."

Holcomb said the food the organization collected last year reached about 12,000 children, families and seniors throughout the county each month.

With the old van, the organization collected about 510,000 pounds of food, which accounts for about one-quarter of all the food distributed by Food for People.

Inaugural leg. intern reality fair a success in Mass.

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BOSTON (7/14/14)--Massachusetts House of Representatives and Senate legislative interns participated in their first reality fair Thursday.
 
The Scholars and Cents program was sponsored by the City of Boston CU, with $321 million in assets; Mass Bay CU, with $201 million in assets, South Boston; and Metro CU, Chelsea, Mass, with $1.3 billion in assets, the Massachusetts Credit Union League reported ( Daily CU Scan July 11). 
 
Click to view larger image Dan Picard, special accounts manager, City of Boston CU, addresses participants of the reality fair. (Massachusetts Credit Union League Photo)
Almost 90 students sponsored by 20 senators and 30 representatives gained valuable insight into financial challenges they will face as they emerge from their academic careers to life on their own.  The participating students are enrolled in high school, college and graduate school and have chosen to volunteer in the public sector at the State House.  In addition to local students, attendees were also from Korea, England and Ireland.  The summer legislative intern series incorporates more than 60 programming segments to benefit the students.
 
Student reactions to their spending and savings habits included, "I'm terrible about money," "I shop too much," and "I can budget for large but not small day-to-day items."  One student commented, "I had no credit and therefore could get no credit."  Another said borrowing is "simply money to repay."
 
By the end of the program, students openly acknowledged that "food is expensive," that they "needed to read the fine print before accessing credit," and that "retirement is important and needs lots of money."
 
The daylong program integrated traditional educational exercises with a special identity theft presentation by Patricia Hamilton, director, Public Inquiry and Assistance Center, Massachusetts Attorney General's Office. 
 
The participating credit unions sought to complement their current financial education efforts during the school year by expanding their work into the summer.

CU System briefs (07/14/2014)

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  • BOISE, Idaho (7/14/14)-- Will Hall, government affairs officer for the Idaho Credit Union League, has been promoted to vice president of the league and of League Services Inc. ( Gem July 2). Hall will continue in his role as government affairs officer and as the league's main lobbyist but will also be more involved in the administration, operations and strategic planning for the two organizations ...
     
  • GREENEVILLE, Tenn. (7/14/14)-- A former employee of Knoxville (Tenn.) TVA Employees CU was sentenced last week on charges of allegedly embezzling $420,000 from the credit union. U.S. District Judge J. Ronnie Greer sentenced 41-year-old Tamra Vance Robinson to 33 months in federal prison, three years of supervised release and restitution of $420,000. Robinson pleaded guilty in March to grand jury charges. According to a Department of Justice release, between 1998 and 2011, Robinson allegedly embezzled funds from the $1.3 billion-asset credit union by creating a fictitious teller drawer to conceal cash withdrawals, manipulating the coin and currency receipt and disbursement records, and falsifying entries for the vault, teller ledgers, teller drawers and ATM. According to Assistant U.S. Attorney Helen Smith, an investigation into the embezzlement never located the stolen funds ( Kingsport Times-News July 11) ...
  • COLUMBUS, Ohio (7/14/14)-- Bob Johnson, a former Ohio Credit Union League field staff liaison, died July 6 . He was 83. Johnson worked for the league for 16 years, retiring in 1993 ( eLumination July 9) ...

Spokane CUs raise $159K for CUs for Kids

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SEATAC, Wash. (7/14/14)--The Spokane (Wash.) Chapter of the Northwest Credit Union League celebrated a milestone $159,290 raised for Children's Miracle Network Hospitals last year ( Anthem July 8).
 
The Spokane Chapter noted the exceptional work of Spokane Teachers CU (STCU), Liberty Lake, with $1.9 billion in assets, which raised the highest amount by a single credit union at $56,002.78; and Amicus FCU, Spokane, with $11 million in assets, which reported the highest amount raised per member at $2.82.
 
Top fundraisers by asset size were Amicus FCU; Spokane City CU, Spokane, with $34 million in assets; United Health Services CU, Spokane, with $101 million in assets; and STCU.
 
Other credit unions highlighted at the event included Progressions CU, Spokane, with $54 million in assets; Cheney FCU, with $87 million in assets; Spokane Media FCU, with $10 million in assets; Coulee Dam FCU, with $110 million in assets; Horizon CU, Spokane Valley, with $601 million in assets; PrimeSource CU, Spokane, with $54 million in assets; Spokane FCU, with $131 million in assets; Avista Corp. CU, Spokane, with $54 million in assets; Global CU, Spokane, with $367 million in assets; Numerica CU, Spokane Valley, with $1.3 billion in assets; Safeway FCU, Spokane, with $54 million in assets; and Washington State Employees CU, Olympia, with $2 billion in assets.
 
The Northwest Credit Union Association's Heroes of Hope dinner and auction to benefit Credit Unions for Kids will be Oct. 8 in Spokane.

CU's new HQ: High-tech, high-touch, no corner office

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BRIGHTON, Mich. (7/14/14)--Anyone who walks through the doors of Lake Trust CU's new headquarters once it opens next year may mistake their surroundings for the offices of Facebook or Google.

But while the $1.6 billion-asset, Brighton, Mich.-based credit union is sticking to financial services--as opposed to social networks or search engines--the organization hopes the unique, open workspace environment it has incorporated into the design will stir up the same type of innovation and collaboration that's often found in Silicon Valley.  

"(It's) the kind of organization that we are; we strongly believe in innovation and collaboration, and all of those things truly benefit our members," Danielle Brehmer, Lake Trust vice president of strategic innovation, marketing and public affairs, told News Now . "Having this really open environment, where not even the CEO has an office, we can integrate the different lines of business."

That's right: David Snodgrass, Lake Trust president/CEO, will sit at a work station in the middle of all other employees.

"I don't have an office," Snodgrass told the Lansing State Journal last week.

Brehmer told News Now that Lake Trust staff toured offices like Facebook and Google, as well as local businesses in Michigan, to flesh out the design for the new headquarters.

The building will replace the credit union's current Lansing and Plymouth facilities that are aging and expensive to maintain. The new headquarters also will enable Lake Trust to better serve its expanded field of membership after the 2010 merger of NuUnion CU and Detroit Edison CU.

In addition to open work spaces, the resultant $30 million building will house 350 employees and include a fitness center, cafeteria, walking trail on the perimeter of the property and community rooms.

The 100,000-square-foot facility also will be LEED certified, meaning it will meet the most current sustainable building design standards.

"You can't call yourself innovative if you're not thinking about sustainability and long-term impacts," Brehmer told News Now . "Look at the way of the world, that's who consumers are today."

The building is expected to be completed by October 2015.

Ala. CUs join nationwide 'Bank on' campaign for unbanked

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MOBILE, Ala. (7/14/14)--Four Alabama credit unions have joined a national campaign to help consumers become more financially independent.
 
In south Alabama, the Bank On initiative includes more than 20 credit unions and banks that offer financial services at lower costs to the community ( al.com July 11).
 
Among the Alabama credit unions participating in the program:
  • Army Aviation Center FCU, Daleville, with $1.1 billion in assets;
  • Azalea City CU, Mobile, with $19 million in assets;
  • McIntosh (Ala.) Chemical FCU, with $22 million in assets; and
  • New Horizons CU, Mobile, with $208 million in assets.
Individuals who have had accounts closed because of past financial troubles or bounced checks more than six months ago may be eligible for the program. Participating financial institutions offer free checking and/or second chance accounts.
 
Since the first Bank On program was launched in San Francisco in 2006, this model of financial access has been refined, replicated and identified as a leading strategy for state and local officials across the United States to bring unbanked and underbanked consumers into the financial mainstream.
 
Bank On programs negotiate with credit unions and banks in local communities to reduce barriers to banking and increase access to the financial mainstream. Typically led by local government or state public officials, Bank On programs are voluntary, public/private partnerships between local or state government, financial institutions and community-based organizations that provide low-income, un- and underbanked people with free or low-cost starter or second-chance bank accounts and access to financial education.
 
Bank On Oregon is also sending a "shout out" for support from local financial institutions. "We need the participation of credit unions to make this effort a success," David Tatman, administrator of the Division of Finance and Corporate Securities, a division of the Oregon Department of Consumer and Business Services, told the Northwest Credit Union Association ( Anthem July 11). "We want to ensure there are a variety of safe and affordable products available on the Bank On Oregon website to fit the needs of Oregonians."

Credit unions from Dubuque, Iowa, Baton Rouge, La., California and Idaho are among the many that are participating in the Bank On program.

Corbett signs lien legislation protecting Pa. CUs

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HARRISBURG, Pa. (7/14/14)--Pennsylvania Gov. Tom Corbett last week signed into law a bill intended to protect homeowners from unfair mechanics' liens and eliminates mechanics' lien rights for subcontractors.
 
The legislation, known as Act 117, addresses concerns from a Pennsylvania Superior Court opinion that held a credit union's open-end mortgage was subordinate to a mechanics' lien, the Pennsylvania Credit Union Association (PCUA) reported ( Life is a Highway July 11).

Act 117 remedies this problem for credit unions in two ways: 
  • It amends the open-end mortgage statute to specifically allow proceeds to be used to fund soft costs, such as title insurance, transfer taxes, legal fees, engineering fees, accounting fees, architectural fees and management fees.
  • Open-end mortgages will receive priority over a mechanics' lien only if more than 60% of the proceeds of the loan secured by the open-end mortgage are used to fund hard or soft construction costs.
"The association would like to thank bill sponsor Sen. Kim Ward (D-39), House companion bill sponsor Rep. Sheryl Delozier (R-Camp Hill) and Gov. Tom Corbett for their leadership on behalf of credit unions and consumers," said Patrick Conway, PCUA president. "Act 117 will ensure consumers aren't penalized from unscrupulous contractors while protecting Pennsylvania credit unions with respect to their lien priority for construction loans."
 
The act will go into effect in 60 days.

American dream: 'I can make it, it's tougher for others, says Credit.com

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SAN FRANCISCO (7/14/14)--A financially secure retirement and freedom from debt are more representative of the American dream than the house with a white picket fence, according to the 2014 Credit.com American Dream Survey.

Thirty-six percent of respondents said retiring at 65--and being financially secure when they do so--is the ultimate American dream. A quarter said getting out of debt was their goal.

Though the majority of respondents were optimistic about their ability to reach their vision of the American dream--16% said they've hit their goal and another 50% say it's within their reach--nearly 70% say they don't believe "other people" will be able to achieve their own version of the American dream.

Credit.com reported that this is the second year that people are more optimistic about their own future than that of others. The survey polled 1,094 U.S. consumers age 18 and older.

"The American dream appears to now be about getting out of debt and getting to retirement age with a sense of financial security," said Adam Levin, credit.com co-founder/chairman. "And the sense is that the next generation will find it even harder to get there."

Other definitions of the American dream are owning a home (17%), joining the "1 percent," (5%), graduating from college (3%) and paying off student loans (2%).

The definition shifts with age, however. For those 18 to 29 years old, owning a home was the most popular definition at 22%, followed closely by retirement under financially secure circumstances (20%) and living debt free (19%).

The debt-free goal is a challenge for those with student loan debt.  Nearly one-third of those who carry outstanding student​ loans were most likely to say it was not very or not at all likely that they would be debt-free in their lifetimes.

Kindness alert: NEFCU starts 'Pay It Forward Friday' today

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WESTBURY, N.Y. (7/11/14)--NEFCU is telling Long Islanders, "It's on us," this summer as the credit union this week announced a "pay it forward" initiative.
 
Starting today, the $2.2 billion-asset Westbury, N.Y.-based credit union will send local branch employees into the Long Island community to surprise residents with free lunches, coffee, treats and gas, and perform other good deeds.
 
NEFCU also will be helping three Long Islanders in need. Throughout the summer three local residents will receive up to $1,500 in assistance. NEFCU is asking for nominations of three people or families who would benefit most from the larger donations.
 
"Every Friday this summer, we'll be looking to bring a smile to hundreds of Long Islanders' faces and show them the power of 'paying it forward,'" said Edward Paternostro, NEFCU president/CEO.  "This is an exciting and enjoyable program for everybody involved as we go deep into the community--and deep into our pockets--to bring a little happiness and assistance to our neighbors."
 
The program kicks off today in Commack. Throughout the day, local NEFCU branch employees will be out in the community, looking for opportunities to  pay it forward, whether it's bringing meals to a senior center, providing balls to children in a town park or buying a late-running commuter a train ticket.
 
NEFCU's "Pay It Forward Fridays" team will also be handing envelopes stuffed with a $5 bill to passers-by in the hope that they, too, will use the money to brighten the lives of a stranger.
 
Following the Commack debut, the promotion moves to a different community each Friday.
 
For the three people or families selected to receive the large donations from NEFCU, each will be handed a check on a different Friday at a local NEFCU branch.
 
"We'll be looking to do so many little things that make a difference in the lives of our neighbors, but in three instances this summer, we hope to provide a little bit of hope for those who could use a helping hand or some assistance amidst some difficult times," said Paternostro.

Time MONEY recognizes Olson for refugee fin. ed.

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ST. PAUL, Minn. (7/11/14)--Sandy Olson, an employee of the charitable foundation of $1.7 billion-asset Affinity Plus FCU, St. Paul, Minn., has been recognized as a Time MONEY hero.
 
One person from each state and Washington, D.C., is recognized as a MONEY hero for helping others improve their personal financial situations.
 
Olson was nominated and selected as the MONEY hero in Minnesota for teaching financial education courses to refugees at MORE Multicultural School for Empowerment (MORE) for the past 11 years. The topics she covers in the courses include money management, budgeting, credit cards and lending.
 
"During each class, I provide refugees with tools that will help them understand our country's financial system, and then dive into specific topics like checking and savings accounts for example," said Olson. "Most importantly, I listen to their questions and concerns, and help them find answers. As the discussion develops, and their confidence and trust grows, so does our relationship."
 
"Olson has never been out of the country yet she teaches refugees from Bhutan to Ethiopia," the MONEY magazine article said in describing Olson's work. "Today the personal finance classes she teaches are the last of a series in which immigrants learn English and basic living skills. Olson explains budgeting and shows her students how to compare credit cards and real estate online; she discusses the link between credit reports and hiring. And she drives her students around because most don't have cars."
 
Olson told MONEY that providing rides for her students helped them develop a bond and build trust. "Trust is huge factor," she said. "They've been through so much."
 
Olson's dedication is inspiring. More than a dozen of her Affinity Plus co-workers have also volunteered at MORE, MONEY reported.
 
For more on Olson and her work, use the links.

CU System briefs (07/11/2014)

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  • WASHINGTON (7/11/14)-- Four Washington, D.C.-area credit unions were recognized for their achievements associated with the April 6 Credit Union Cherry Blossom Ten Mile Run, which benefits Children's Miracle Network Hospitals . Constellation FCU, Reston, Va., with $181 million in assets, raised the most in the member donation challenge. Department of Labor FCU, Washington, with $71 million in assets, raised the most in the organizational donation challenge. NASA FCU, Upper Marlboro, Md., with $1.3 billion in assets, was the top credit union running team with the top credit union male runner and top credit union female runner. SECU, Linthicum, Md., with $2.8 billion in assets, was named the most spirited volunteer team. This year's race resulted in a $487,000 donation to Children's Miracle Network Hospitals ...
     
  • NEW CASTLE, Del. (7/11/14)-- The Delaware Credit Union League and NetDE Business Group will hold their first networking event for seasoned credit union professionals of all ages Tuesday in Newark, Del. The league said it envisions all participants can provide information and insight into their own generations ...
     
  • COLUMBUS, Ohio (7/11/14)-- John Florian, vice president of government and political affairs at the Ohio Credit Union League, is leaving the league after 23 years. Florian, who has a master's degree in theological studies from Washington Theological Union, will pursue his passion of spiritual ministry, according to the eLumination newsletter (July 9). "During his 23 years, John made many lasting contributions to the league and greater credit union movement," said league President Paul Mercer. "In particular, he laid many of the foundational blocks on which our advocacy business has grown strong."  Florian's last day is July 18 ...

Fin. ed. for student body key part of Altura, UC-Riverside partnership

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RIVERSIDE, Calif. (7/11/14)--Altura CU, Riverside, Calif., announced a four-year contract with the University of California-Riverside's (UCR) multimedia rights partner this week, an agreement that will allow the $731 million-asset credit union to provide the university's students financial education, among other services.

"We have strong ties to UCR and to the educational community throughout Riverside County," said Mark Hawkins, Altura CEO. "Working together, we can help them build the financial skills they will need to help them better manage their financial lives, now and in the future."

As UC-Riverside Athletics' official credit union partner, Altura will sponsor financial literacy and life skills education, offer Spirit Debit Cards, host in-game promotions at UCR athletic events, have access to branding opportunities and offer an ATM at the SRC Arena.

"We are fortunate to have such a vested partner in not only the UCR athletic program and our student-athletes, but to the entire student body through Altura Credit Union's involvement in financial literacy program, on-campus ATM and student- and affiliate-centric banking services," said Jim Wooldridge, UCR athletic director.

Debit rewards programs still valuable to members, CUs find

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MADISON, Wis. (7/11/14)--Credit unions are finding success in offering debit reward programs to their members--three years after big banks bailed on the programs in the wake of interchange rule changes.

While most big banks jumped ship, community financial institutions--including credit unions--saw an opportunity: Debit cards account for nearly 50% more noncash transactions than credit cards. And consumers are more than happy to earn cash for spending money ( CreditCards.com July 9).
 
About one-third of financial institutions offer rewards tied to debit cards, according to Aite Group research.
 
Credit unions say the programs fit with their members-first philosophy, according to Ron Shevlin, Aite Group senior analyst. Most community financial institutions are using debit as a channel for growth, according to Shevlin. Among those with a debit card rewards program in place, 60% said the program helped drive usage.
 
At $1 billion-asset Hanscom FCU, based on Hanscom Air Force Base, Mass., the MemberPoints reward program has been popular with members since 2007, according to Steve Silva, the credit union's vice president of marketing.
 
Members earn one point for every $2 when they sign a receipt, or five points per transaction when they use a PIN. The program makes the credit union's checking product more appealing, Silva told CreditCards.com . Points are used to make purchases from a merchandise catalog.
 
Studies show that consumers prefer using debit cards to credit cards. About 49% of those polled said they preferred to pay by debit, while 34% said they preferred credit. Another 11% said they preferred paying by cash or check, according to a 2013 Consumer Payment Choice Study by the payments processing company TSYS.
 
At Directions CU, Sylvania, Ohio, with $598 million in assets, debit rewards are an added benefit for members with checking accounts but not necessarily a driver on their own, Julie Linch, senior vice president of retail delivery, told CreditCards.com . Consumers still expect other benefits, such as free checking, Linch said.
 
Bankrate's 2014 Credit Union Checking Survey found that 72% of the nation's 50 largest credit unions offer a free checking account, which means there are no monthly service fees or point-of-sale transaction fees associated with the account ( News Now March 4).

CU growth buoys hiring, pay increase plans: CUNA survey

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MADISON, Wis. (7/11/14)--Burgeoning membership expansion and the potential for double-digit loan growth are incubating a stronger employment environment at credit unions--one that portends more hires and increased wages, according to research from the Credit Union National Association.
 
In the soon-to-be released 2014-2015 CUNA Staff Salary Report, nearly 30% of credit unions plan to add full-time employees to their payrolls in 2014--an increase from overall figures of 25% in 2013 and 20% in 2012.
 
In credit unions with $200 million or more in assets, a full 60% plan to expand their employee numbers this year.
 
"With credit union operating results in the aggregate, and by most means, back to pre-recession levels, credit unions are healthier than they have been in years," CUNA interim Chief Economist Mike Schenk told News Now .
 
Between trends of double-digit loan growth and 2.5% annual membership growth, "it's a pretty good indication that there would be a need for additional people and resources to serve new members," Schenk added.
 
On average, credit unions plan to add 3.9 full-time employees. That number rises with asset size, hitting 37 expected additions for credit unions with assets of $3 billion or more.
 
Part-time employees also play a part in 2014, with almost a quarter of credit unions planning to add part-time workers and an average 2.1 staff members. Fewer than 10% of credit unions plan to reduce full- or part-time staff, and the vast majority of those planning to make reductions are eliminating just one position.
 
This is the third year that nearly three-quarters of credit unions with $1 million or more in assets have plans for wage or salary increases. "As the job environment improves, credit unions will be paying more to keep their top-performing employees," said Jon Haller, CUNA director of market and corporate research.
 
Both actual increases and anticipated increases are somewhat more likely to be found among credit unions with assets of $20 million or more than among their smaller counterparts.
 
About 70% to 80% of credit unions provided salary/wage increases to each of the three following employee categories: CEO, management employees and non-management employees.
 
Similar percentages of credit unions anticipate providing such increases to each of these groups this year and in 2015.
 
Wage growth also is supported by a reduction in pay freezes, Haller noted. "Only 17% anticipate any wage freezes this year, a significant drop from the 2010 and 2011 high of 45% and the slide to 35% in 2012 and 2013," he said.
 
Those expected wage freezes are more likely to be encountered at credit unions with less than $20 million assets.
 
As credit unions look to a changing leadership demographic, 10% of CEOs--including about 25% to 35% who are currently age 60 or older--plan to retire in the next two years. Seventy-five percent of credit unions with CEO retirements on the horizon have succession plans in place.
 
The survey features compensation data for 90 positions, including CEO and 10 part-time positions. Data includes:
  • Base salaries;
  • Incentives;
  • Bonuses;
  • Total cash compensation;
  • Salary ranges; and
  • Asset categories for $1 billion to $3 billion, and more than $3 billion.

CUNA Councils reaches milestone of 6,000 total members

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MADISON, Wis. (7/11/14)--The Credit Union National Association's nationwide organization for credit union executives--CUNA Councils--has reached the 6,000-member milestone.
 
"That's 6,000 credit union leaders collaborating and sharing insights, and 6,000 credit union leaders working together to drive the movement forward," said Jill Tomalin, CUNA executive vice president/chief operating officer. "If you're not already a Council member, connecting with this ever-growing community of credit union peers is something that will benefit you both professionally and personally."
 
Members have access to cooperative peer resources and experienced advice through the CFO Council; HR/TD Council; Lending Council; Marketing and Business Development Council; Operations, Sales and Service Council; and Technology Council.
 
The celebration and nationwide prize giveaway runs through Aug. 29. There are six ways to enter and six prizes, including a grand prize valued at up to $2,670. In the spirit of paying it forward, for each new member who joins by Aug. 29, the Councils will donate $6 to the National Credit Union Foundation.
 
Use the resource links for more information about CUNA Councils and to join the 6,000-member celebration.

Global study finds 1 in 6 U.S. students financially illiterate

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PARIS (7/11/14)--In a recent international study that looked at the financial capabilities of 15-year-olds, U.S. teenagers scored below average in financial literacy, and roughly 17.8% of American students were found to be financially illiterate, meaning they failed to complete even the most basic of tasks.

"This group of students can, at best, recognize the difference between needs and wants, make simple decisions about everyday spending, recognize the purpose of everyday financial documents, such as an invoice, and apply single and basic numerical operations," found the Organisation of Economic and Development, which administered the international assessment.

About 29,000 15-year-olds from 13 countries participated in the test, which gauged knowledge and financial skills such as reading and comprehending a bank statement, calculating the long-term cost of a loan or understanding how insurance works.

Americans scored just below the mean score of the 13 countries. The average score was 500, and U.S. teenagers averaged a 492.

Those from Shanghai-China posted the highest average score in financial literacy, above 600, with Belgium, Estonia, Australia, New Zealand, the Czech Republic and Poland behind them, though only 1 out of 10 students were able to handle complex financial situations across the board, including in the United States.

Students with bank accounts scored higher than those without them, the study found. In the United States, about 50% of 15-year-olds reported having bank accounts and in general performed better than those who didn't.

Other factors that influenced performance were:
  • Gender;
  • Wealth;
  • Cultural possessions and number of books at home;
  • Parents' highest occupational status and level of education;
  • Immigration status; and
  • School location.

NCUF reminds of July 31 Wegner award nomination deadline

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MADISON, Wis. (7/10/14)--July 31 is the deadline to nominate individuals and organizations for the Herb Wegner Memorial Awards presented by the National Credit Union Foundation.
 
Winners will be honored at NCUF's annual awards dinner on March 9 in conjunction with the Credit Union National Association's Governmental Affairs Conference in Washington, D.C.
 
"Don't delay to nominate the finest individuals and organizations or programs for what are widely considered the highest national honors in the credit union movement," said Danielle Brown, NCUF director of development and donor relations.
 
The nominations are being accepted for:
  • The Individual Achievement Award honors an unsung hero for their innovative concepts and/or accomplishments that are ongoing and current contributions to the credit union community for their work within the past three to five years. Accomplishments must have had a significant impact or a potential impact on the local or national or international credit union movement with measured results. Nominations must cite a specific subject of achievement such as financial literacy, service to the underserved, alternatives to predatory lending, and/or new products.
  • The Outstanding Organization/Program Award honors an organization, program or business for their innovative concepts or product and services that have had a significant impact on the local or national or international credit union movement with measured results.
  • The Lifetime Achievement Award honors an individual who has dedicated their life to promoting the credit union philosophy, created innovative concepts and provided leadership that has had a significant and lasting impact on the local or national or international credit union movement.
Nominations can come from individuals or organizations. To make a nomination:
  • Complete the Wegner Awards nomination form on the NCUF website. Use the link.
  • Gather at least five letters of recommendation citing examples of the nominee's achievements relevant to the award criteria
  • Send the nomination form and recommendation letters electronically to NCUF by July 31.
Questions about the Wegner Awards can be directed to Danielle Brown at dbrown@ncuf.coop or 608-556-2406.

LSCU ready to support state's adoption of nat'l fin. ed. standards

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TALLAHASSEE, Fla. (7/10/14)--It's now mandatory that students in Florida receive at least some training in financial literacy.

Florida's Board of Education adopted a financial literacy "strand" into its social studies curriculum standards last month, the first state in the nation to do so.

Developed by the Council for Economic Education's Standards for Financial Literacy, the program includes lessons in financial literacy topics such as savings and investment. The standard is also expected to be a precursor to a mandatory full course on the subject in the future.

The League of Southeastern Credit Unions supported legislation by Sen. Dorothy Hukill (R-Port Orange) and Rep. Heather Dawes Fitzenhagen (R-Fort Myers) that would have required students to complete a one-semester financial literacy course, but SB 212 and HB 367 did not leave the committee process in the 2014 session (eSignal Daily July 9).

The league said it will continue to work on that legislation with its sponsors during the next session.

CU System briefs (07/10/2014)

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  • ST. LOUIS (7/10/14)-­The St. Louis Post-Dispatch's 90 "Top Workplaces" included four area credit unions, showing that not only are credit unions good places to bank but are good places to work (Missouri Difference July 7). The results are based on employee surveys by Workplace Dynamics. 1st Financial FCU, Wentzville, with $202 million in assets, also was recently nominated by Small Business Monthly as one of the "Best Credit Unions in St. Louis." Anheuser-Busch Employees' CU, St. Louis, with $1.4 billion in assets, is ranked as a "Top 150" credit union in the United States. This is the second year on the list for First Community CU, Chesterfield, with $1.9 billion in assets. Scott CU, Edwardsville, with $961 million in assets, was one of only 15 companies to be recognized for the third consecutive year ...
     
  • SACRAMENTO, Calif. (7/10/14)--The Friends of the California State Fair bestowed one of its highest honors--the Golden Bear Award--to Golden 1 CU, Sacramento, Calif. U.S. Rep. John Garamendi (D-Davis) also was on hand to present a commendation to Donna Bland, president/CEO of the $8.4 billion-asset credit union. The Golden Bear Award acknowledges individuals and businesses that have furthered the state fair's mission of showcasing California's economic and cultural diversity. For more than 15 years, Golden 1 CU has sponsored a concert stage, provided more than 20 ATMs throughout the Cal Expo grounds and funded the installation of the CALIFORNIA letters at the main entrance of the fairgrounds ...
  • MARLBOROUGH, Mass. (7/10/14)--The merger of SJB FCU, Fall River, Mass., with $24 million in assets, and Southern Mass CU, Fairhaven, Mass., with $187 million in assets, became effective July 1 (Daily CU Scan July 9). Southern Mass CU also received regulatory approval to expand its field of membership to the Massachusetts counties of Dukes and Nantucket and cities and towns in Providence County, Rhode Island. SJB FCU was founded in 1940 as St. Jean Baptiste FCU as a parish credit union, eventually expanding to the Bristol County, Mass., and the Rhode Island towns of Tiverton and Little Compton ...
  • WARMINSTER, Pa. (7/10/14)--Effective July 4, John King succeeded retiring Lee MacMinn as president/CEO at Freedom CU, a $647 million-asset credit union in Warminster, Pa. King, who was executive vice president/chief operating officer at Freedom CU, has credit union experience dating back to his senior year in high school. He previously worked at three other Philadelphia-area credit unions, until becoming CEO at Fischer and Porter CU, now Freedom CU. King earned degrees from Bucks County Community College and the Philadelphia College of Textile and Science ...
 

Two CUs rake in more than $30K for youth charities

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SAN DIEGO and HERNDON, Va. (7/10/14)--Children's Miracle Network Hospitals on opposite sides of the country were among the recipients of two credit unions' generosity during recent fundraising campaigns.
 
Cabrillo CU, San Diego, raised more than $17,000 to benefit Rady Children's Hospital-San Diego during the $222 million-asset credit union's annual effort.
 
"In our 21 years of fundraising for Rady Children's, this has been one of our biggest years yet," said Senior Vice President Anne McClure.
 
During its Miracle Month of May campaign, the credit union sold paper balloons in its branches, and its employees also hosted a silent and live auction that brought in more than $3,000.
 
Carrie M. holds the keys to a 2014 Honda Civic, which she won in Herndon, Va.-based Northwest FCU's "Help Us Help Our Kids Car Raffle," which raised funds for the Children's Miracle Network and the Ben DeFelice Scholarship program. (Northwest FCU Photo)
Across the country, in Herndon, Va., Northwest FCU and its charitable arm, the NWFCU Foundation, raised $15,615 for Children's Miracle Network Hospitals and for its Ben DeFelice Scholarship fund.
 
In its "Help Us Help Our Kids Car Raffle," the $2.6 billion-asset credit union gave away a 2014 Honda Civic, thanks to a partnership with Sport Honda, a dealership in Silver Spring, Md.
 
"We far exceeded our goal for the event, which was to raise $10,000," said Linda Rogus, executive director, NWFCU Foundation.
 
The NWFCU Foundation awards the Ben DeFelice Scholarship to credit union members who are attending graduate, undergraduate or associate degree programs and who exhibit leadership, dedication and commitment in school, at home and in the community. The scholarship honors the longest-tenured board chair who was instrumental in the growth and success of the credit union.

FAA CU 1st in Okla. to receive Juntos Avanzamos designation

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OKLAHOMA CITY (7/10/14)--The Cornerstone Credit Union League has bestowed its Juntos Avanzamos designation on FAA CU, Oklahoma City, with $546 million in assets (Leaguer July 9).

Juntos Avanzamos translates to "Together We Advance" in Spanish.

The designation--the first assigned to a credit union in Oklahoma and the 27th overall--recognizes credit unions that successfully complete a rigorous application process that affirms its capacity, commitment and compassion to serve the financial needs of Hispanic families.

"We have been serving the Hispanic population for a number of years and we are committed to serving, empowering and enriching these families," Steve Rasmussen, FAA CU president/CEO, told Leaguer. "This designation demonstrates and strengthens our commitment to help our members in the community build strong financial futures."

FAA CU's second-busiest branch operates from the heart of a Hispanic community in the Oklahoma City metro area, according to Rasmussen.

The branch employs a bilingual staff, and its interior design is intended specifically to engage Hispanic members.

Further, the credit union provides top-quality services geared towards Hispanic members, including:
  • Bilingual services in six of its seven branches;
  • Second chance checking;
  • Credit-building loans;
  • Lines of credit and credit cards;
  • A home loan product;
  • Financial education;
  • A Spanish call queue for non-English speaking members;
  • Signage and marketing materials in both English and Spanish; and
  • Advertising with local Spanish media.
FAA CU will officially be awarded the Juntos Avanzamos designation with a flag-raising ceremony hosted by Cornerstone.

Faces, stories begin to fill 100M membership website

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MADISON,
"I may be 1 in 100 million members, but my credit union treats me like I'm #1 every time!," wrote Brianne from Edina, Minn. "I am confident that I am making the best financial choices for my family and that we are part of a larger community of consumers who want to make a difference in this world!"
Wis. (7/10/14)--The newly constructed Membership Map on the Credit Union National Association's 100 million membership campaign website is beginning to fill up with the faces of credit union members from throughout the country.

Credit union members are showing "what 100 million looks like" by sending selfies of themselves and corresponding credit union stories to www.americascreditunions.org, as part of a campaign to highlight the industry's milestone of reaching 100 million memberships, a feat it expects to achieve later this summer.

To see how many selfies each state has collected, access the Membership Map by clicking on the red menu tab on the main page of the site, clicking on an individual state, and then on the "Other Credit Union Members From This State" link. Use the resource links to either access the full map or to submit a selfie.

"My credit union helped me build my credit with a share-secured loan when I was 18 and now I have my first car loan!" wrote Morgana, from Hunersville, N.C. "I also like their free debit card and Vacation, Holiday & Back-to-School savings clubs."
In addition to the pages full of faces, those who access the interactive map also will stumble upon interesting facts about each state--facts that of course relate back to the number 100 million.

Click on California and find out the world's tallest tree, a 369-foot California Redwood, would need to be stacked on top of itself 271,000 times in order to equal 100 million feet.

Click on Illinois and discover that Illinois' 12 million acres of cornfields would need to be expanded eight-fold to cover 100 million acres.

The website also features news and a full gallery of all the selfies that have been submitted. Check back often to see how many selfies have been posted from your state--and to see your own.

Shared branching awareness campaign goes national

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ST. LOUIS (7/10/14)--A shared branching video created by the Missouri Credit Union Association (MCUA) has developed a growing national audience.
 
Since the 90-second clip debuted in October, several other state leagues have asked to link to the video, which helps consumers understand how to use the CO-OP Shared Branch Network. Among the state leagues that feature the video are Vermont, Utah, New Jersey and Pennsylvania.
 


MCUA is also working with the Pennsylvania Credit Union Association to have the video translated in Ukrainian.
 
"We're happy to share the shared branch video because we want more members using this valuable service," says Mark Hohenstein, MCUA vice president of the credit union shared branch network (Missouri Difference July 9). "I want to thank the shared branch task force for their support of this project."
 
The shared branch task force includes:
  • Louie Delk, president/CEO, Conservation Employees' CU, Jefferson City, with $97 million in assets;
  • Chris McCreary, president/CEO, United Consumers CU, Independence, with $123 million in assets;
  • Brandon Michaels, president/CEO, Mazuma CU, Kansas City, with $488 million in assets;
  • Stan Moeckli, president/CEO, Electro Savings CU, St. Louis, with $151 million in assets;
  • Dave Osborn, president/CEO, Anheuser-Busch Employees' CU, St. Louis, with $1.4 billion in assets;
  • Kathie Peterie, president/CEO, Metro CU, Springfield, with $52 million in assets; and
  • Randy Yeck, vice president, human resources, Vantage CU, Bridgeton, with $737 million in assets.
Among the ways credit unions and leagues can feature the video:
 
  • On a website. A text link to the YouTube channel would be the simplest way to share the video with members. Use the resource link below to access the YouTube video.
  • On social media. Depending on which social media channels the credit union uses, the process will vary. For assistance sharing a video, contact Nora Holloway, MCUA public relations and online community director, at nholloway@mcua.org or call 800.392.3074, ext. 1349.
  • In a branch lobby. Burn a copy of the video to a disc or add it to the current programming lineup. For assistance, contact Brianna O'Hara, MCUA marketing director at bohara@mcua.org or call 800.392.3074, ext. 1360.
  • Via an email in a link or in an online member newsletter. Statistics show that consumers engage with video and find it useful in making decisions, MCUA said.

Small-biz lending surge of 20% drives Mich. Q1 loan growth

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LANSING, Mich. (7/10/14)--Michigan's credit unions showed strong growth in the first quarter--buoyed by small-business lending that at $1.7 billion was 20% more than the same period last year.
 
"Supporting our communities is a vital component of the credit union difference. Helping small businesses grow and thrive is a key part of that mission," said David Adams, Michigan Credit Union League and Affiliates CEO.
 
Over the past 10 years, small-business loan growth has climbed steadily in Michigan to $1.7 billion in 2014 from $875 million in 2010 and $200 million in 2004.
 
In cooperation with the Michigan Business Connection, Lake Trust CU, a $1.6 billion-asset credit union in Brighton, granted a loan to Shirley Decker Prescott; her husband, Mert Prescott; and son, Brandon Decker. Shirley and Mert both lost their jobs in the grocery industry and decided to open their own meat and seafood market. Funding was a challenge until Lake Trust CU approved the loan.
 
Three years later, Mert's Specialty Meats is thriving with two locations in Okemos and Lansing. "We have customers every day who thank us for being here," Shirley said.
 
Small-business loans are just one of the lending categories that is improving in the first quarter.
 
New-vehicle loans totaled $1.8 billion, a more than 10% boost from $1.6 billion a year ago. Used-autos also are up to $5.8 billion from $5 billion year-over-year.
 
Credit unions continue to provide mortgages to Michigan residents with fixed-rate mortgages coming in at $7.9 billion in the first quarter, a 10% increase from the same time last year.
 
Membership continues to expand as well--4.6 million Michiganders are credit union members, showing an increase of 83,245 members from a year ago.

Three league-backed bills await N.Y. gov. signature

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ALBANY (7/10/14)--With the support of the Credit Union Association of New York's state-level advocacy efforts, three important pieces of pro-credit union legislation recently passed through both houses of the New York Legislature.
 
The three bills are now waiting to be sent to Gov. Andrew Cuomo to be signed into law (The Point July 8).
 
The bills include:
  • S.6805B/A.9037A, which would allow credit unions and other financial institutions to establish prize-linked savings accounts, passed the Legislature May 28--just weeks after hundreds of credit union advocates gathered at the state Capitol to lobby lawmakers during the league's state governmental affairs conference. The Assembly version of the legislation was introduced by Rep. Annette Robinson (D-Metropolitan). The Senate version was introduced by Sen. Andrew Lanza (R-Metropolitan).
  • S.6735/A.9057, which would extend the state's 2007 "wild card" law for an additional five years, passed the Legislature June 10. The legislation would extend a law that provides state-chartered credit unions, banks and thrifts with the opportunity to exercise the same banking powers that are available to federally chartered institutions. The Assembly bill was introduced by Robinson, and the Senate version was introduced by Sen. Joseph Griffo (R-Utica-Rome).
  • S.7112/A.9408, which would allow state-chartered credit unions to apply for the ability to combine select employer, associational and community groups into a single field of membership, was passed on June 19--the last day of the legislative session--after weeks of advocacy efforts from the league. The Assembly bill was introduced by Robinson. The Senate bill was introduced by Griffo.
"The [league] remains committed to ensuring that New York's credit unions are represented fairly during the legislative process, and we will continue to work closely with lawmakers and agencies at both the state and federal levels," said Mike Lanotte, league senior vice president/general counsel. "I would again like to thank all of the lawmakers--especially our bill sponsors--who put aside partisan differences to pass legislation that will benefit the state's credit unions and their members."
 
The league successfully lobbied against other pieces of legislation that would have been harmful to credit unions, including:
  • S.3868B/A.7056, which would have prohibited the use of consumer credit reports in hiring and employment decisions;
  • A.7223, which would have imposed additional disclosure requirements of electronic fund transfers;
  • S.6906A/A.9189, which would have authorized municipalities to treat unpaid building code, property maintenance and nuisance violations as unpaid real property taxes;
  • S.6551A, which would have required credit card issuers to issue cards with smart chip technology without imposing any requirements on merchants; and
  • S.7350A/A.9341A, which would have required mortgage lenders and servicers to maintain properties on delinquent mortgages.

Michaud addresses Maine league meeting

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PORTLAND, Maine (7/9/14)--The potential future governor of Maine dropped in to speak at the Maine Credit Union League's annual meeting and convention last month, discussing the positive impact credit unions have had on his life as he addressed the nearly 750 attendees at the event.

Rep. Mike Michaud (D-Maine) tells the credit union professionals in attendance at the Maine Credit Union League's annual meeting and convention that his history with credit unions is "decades long for good reason."
Rep. Mike Michaud (D-Maine), a longtime credit union member and a current board member at Eastmill FCU, East Millinocket, Maine, with $61 million in assets, described his history with credit unions as "decades long for good reason."

"Credit unions are always there to help people," said Michaud, who's been endorsed by the league in his bid for governor. "They helped me as a teenager when I needed a loan for a car and have helped me ever since. The league and credit unions have supported me in every one of my campaigns and I very much appreciate their support again this year because it will be critical to helping me become the next governor."

League President John Murphy called Michaud's understanding and support for credit unions very helpful over the years and said he has been a great friend to the movement through his days in the state Legislature, which included a stint as Senate President, and as a member of Congress for the past 12 years.

"He would be a great governor and be a leader on credit union issues," Murphy said. "As we have on his other campaigns, we will work hard to make that happen."

Young investors prefer older, experienced advisers

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NEW YORK (7/9/14)--While the digital age and social networking have raised the value of peer endorsements, experience still counts with younger generations when it comes to investing, according to one focus group.
 
And--surprise!--digitally savvy Gens X and Y would rather meet face to face with an adviser than seek investment counsel online ( ThinkAdvisor June 27).
 
Young investors value experience, a group of Gen X and Y investors told financial advisers at a recent Securities America conference. Several members of the group work with their parents' advisers and were not likely to work with an inexperienced adviser without much time or experience in the game, said Janine Wertheim, Securities America Advisors president.
 
During the conference session, a group of young investors listened to recordings of advisers describing what they do for clients. The young investors provided their immediate reactions to the advisers' thoughts.
 
The group of Gen X and Gen Y investors was diverse, and included married and single participants, and couples with and without children. Some had already worked with advisers. Others had invested on their own.
 
Young investors were most impressed with advisers who were interested in getting to know their clients and their unique circumstances, Wertheim said.
 
Among the topics they are most like to seek advice on is real estate, and whether they are better off renting, buying or investing.

CU System briefs (07/09/2014)

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  • SANTA ANA, Calif. (7/9/14)-- Counterfeit official checks bearing the name of Orange County's CU, Santa Ana, Calif., are being circulated as part of a national survey scam for a mystery shopper program , according to the $1.1 million-asset credit union. So far, four checks in the amount of $998 have been caught. The counterfeit items display a memo with "June 2014 PYMT" and have the credit union's routing number on them. However, Orange County's CU official checks are issued through Fifth Third Bank ...
     
  • COLUMBIA, Md. (7/9/14)-- As of July 1, Gordon M. Cooley assumed the position of acting commissioner of financial regulation for the Maryland Department of Labor, Licensing and Regulation . He previously was deputy commissioner under Mark Kaufman, who stepped down after four years. The Maryland and D.C. Credit Union Association said it plans to meet with the new acting commissioner soon to make sure industry issues continue to be front and center ( The Daily Scoop June 30) ...
     
  • BOSTON (7/9/14)-- Joseph Finn, board member and clerk for Boston Firefighters CU, Dorcester, Mass., was named commissioner of the Boston Fire Department by Mayor Martin Walsh ( Daily CU Scan July 8). Finn has been on the board of the $193 million-asset credit union for eight years ...
  • MADISON, Wis. (7/9/14)-- UW CU, Madison, Wis., has installed an urban bike-sharing station at one of its branches . With the partnership between UW CU and Madison B-Cycle, members will be able to receive a discounted annual membership. "We're also committed to doing what's right for the environment by supporting this alternative form of transportation," said Brad McClain, executive vice president/chief financial officer at the $1.8 million-asset credit union ...
     
  • HARRISBURG, Pa. (7/9/14)-- Glen Yeager, who has been president/CEO of Utilities Employees CU, for 27 years, announced his retirement ( Life is a Highway July 8). Yeager became CEO in 1987, and the credit union has since grown to more than $1.1 billion from $90 million in assets. It serves 44,000 members from public utilities and energy sector companies in all 50 states, from its sole office in Wyomissing, Pa. "Together we've honed a low-cost 'virtual credit union' model that allows UECU to pay members some of the highest savings rates and rewards of any institution in the country," Yeager said. Upon Yeager's retirement Oct. 1, current Executive Vice President Patricia Zyma will become president/CEO ...
     
  • ST. PAUL, Minn. (7/9/14)-- St. Pascal Parish CU, with $383,000 in assets, has merged with another St. Paul, Minn., credit union . St. Paul FCU, with $129 million in assets, will now serve the parish, school and family members of St. Pascal Baylon Catholic Church ...

Truliant members share 'Life Improved' stories

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WINSTON SALEM, N.C. (7/9/14)--To illustrate its new brand--called "Life Improved"--Truliant FCU, Winston Salem, N.C., is asking members to share just how the credit union has enhanced their financial livelihoods with video testimonials.

Broken down into four categories, each featuring members at various stages of their lives, the videos represent anyone from new members to those who have been a member of the $1.7 billion-asset credit union for more than 14 years.

"We share stories internally every day about the ways members' lives are improved by a Truliant membership, but we also wanted to show it," said Karen DeSalvo, Truliant's chief marketing officer. "These videos demonstrate our 'Life Improved' brand by showing members who genuinely benefit financially from a membership with us."



For example, Troy Knight describes in his video testimonial how after being discharged from the U.S. Army, the credit union helped him refinance an auto loan and subsequently set and begin working towards his financial goals.

"The No Cost Credit Review was a great help coming out of the Army," Knight said. "It really gave me a better understanding of my personal credit situation, where I was, where I needed to be, and helped me establish goals."

Another video features a married couple who have four children and $60,000 in credit card debt that Truliant helped take charge of their financial situation.

The videos demonstrate "the guidance we give individuals to help them persevere in difficult financial situations," DeSalvo added. "Both are ways Truliant executes our mission to improve the quality of life of our members."

Bay Area CUs prepared for housing market challenges

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SAN JOSE, Calif. (7/9/14)--In the always-volatile California real-estate market, Bay Area credit unions may soon face more mortgage challenges.
 
The "b-word," as in bubble, has surfaced in several recent articles focusing on the local housing market, Dan Hapner, director of mortgage sales for $1 billion-asset Meriwest CU, San Jose, told National Mortgage News (July 7), as starter homes prices have increased to as high as $800,000.
 
Once those prices reach $1 million, most, even buyers with incomes of $250,000, will be priced out of the market, Hapner said.
 
To minimize risk, on any loan above 75% loan-to-value or $1 million, Meriwest CU requires two appraisals, according to Hapner. And the loans the credit union does make are to well-qualified borrowers, he added.
 
The median purchase price for a mortgage made by Meriwest CU in April was $808,000, and the average is above $1 million, National Mortgage News reported.
 
Considering those numbers, most of the mortgages Meriwest CU books are jumbos, which the secondary market has minimal interest in. Investors are looking for six to 12 months in payment history. That means the credit union is placing most of its mortgages in portfolio at the current time, with hopes that the secondary market will open up in the future.
 
Part of the reason for the Bay Area market explosion is foreign investment in real estate, particularly from China, said Dwight Johnston, chief economist for the California and Nevada Credit Union Leagues.
 
But Johnston did offer some good news when comparing the current housing market with the market that led to the crash of 2008: The previous crisis was caused by bad mortgages, which are not driving the current market increase.
 
Steve Donahue, vice president of mortgage origination for $1.8 million-asset Technology CU, also based in San Jose, went a step further. He said talk of a housing bubble was unfounded.
 
Donahue said the Silicon Valley housing market is hot because numerous tech companies are moving to the area, creating a demand for expensive housing. With that kind of money coming in, a drop-off is unlikely, he told National Mortgage News .
 
Vince Salinas, vice president of home loans for $4.1 billion-asset Patelco CU, Pleasanton, said that it was unlikely there enough volume in the local housing market to create a bubble. High prices do not equate to a bubble, he told National Mortgage News .

121 Financial emphasizes CU safety, soundness to WJXT-TV

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JACKSONVILLE, Fla. (7/9/14)--The regular "4 Your Money" features by 121 Financial CU on Jacksonville's WJXT-TV typically offer consumer education, but during the July 5 segment, the $449 million-asset credit union took the opportunity to dispel misconceptions brought about by a national news article on credit union lending practices.
 
Rebecca Hulett, senior vice president/chief financial officer, 121 Financial CU, Jacksonville, Fla., explains credit unions' safety and soundness to WJXT-TV host Marques White in a "4 Your Money" segment. ( WJXT-TV Photo)
The piece led off with a reference to a June 6 article in The Wall Street Journal about credit unions' interest-rate risk and if they were as safe as banks ( News Now June 9).
 
The tone quickly changed to a positive one as Rebecca Hulett, 121 Financial CU senior vice president/chief financial officer, explained more about credit unions.
 
The article was "a little bit shaded toward the worrisome side," Hulett noted, adding, "In reality, credit unions have never taken these substantial risks that happened before the bubble burst in 2008, which is why credit unions survived so well throughout the financial crisis."
 
Hulett said that credit unions are easing lending standards slightly, but she credits that to a swing back from the "bit too far" conservative standards created by the financial crisis.
 
She also affirmed the insured status of credit unions--$250,000 per account by the National Credit Union Share Insurance Fund, the same as banks under the Federal Deposit Insurance Corp.
 
Hulett took the opportunity to share the services that credit unions provide, how consumers can learn about the right credit union for them to join and the not-for-profit cooperative structure.
 
"Credit unions are member-owned, so if you hold an account at a credit union, you own the credit union and have a right to vote for the board of directors," Hulett said.

Ind. joins prize-linked savings movement

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INDIANAPOLIS (7/9/14)--Indiana recently joined the growing list of states in which credit unions have the authority to offer prize-linked savings (PLS) accounts when Gov. Mike Pence formally signed into law HB 1235.
 
Click to view larger image From left: John McKenzie, Indiana Credit Union League (ICUL) president; Carrie Summers, ICUL director of advocacy; State Rep. Gail Riecken (D-Evansville); Connie Gustafson, Indiana Department of Financial Institutions general counsel; Indiana Gov. Mike Pence; Chris Beaumont, ICUL vice president of governmental affairs; Kristi Lowell, vice president of brand strategy and development, FORUM CU, Fishers, Ind.; Doug True, FORUM president/CEO and ICUL vice chair; State Rep. Woody Burton (R-Whiteland); and State Rep. Eric Koch (R-Bedford) (Indiana Credit Union League photo)
Nationally, credit unions have led the development of PLS programs by creating savings accounts and other financial literacy tools that reward members who save money by offering chances to win prizes. The programs have been developed as a way to help encourage people to save money and develop good spending and debt management habits.
 
In Indiana, legislative changes were required to ensure that PLS programs would be in compliance with state gaming laws. Previously, PLS programs had to be offered with a "no purchase necessary," sweepstakes-type approach. This meant that members had to be offered a chance to win prizes, even if they did not make deposits or otherwise participate in the programs.
 
In late 2013, State Rep. Gail Riecken (D-Evansville) approached the Indiana Credit Union League about helping her to draft legislation that would authorize credit unions to offer PLS programs without a sweepstakes approach. The legislation also was designed to clarify that credit unions' PLS programs would not fall under Indiana's gambling, lottery, promotions or charity gaming laws.
 
The league worked with Rep. Riecken to draft legislation that would create PLS programs that would be consistent with already-existing PLS programs in other states and those currently being offered by Indiana credit unions as sweepstakes. Although the bill did temporarily get caught up in some minor controversy related to other charity gaming legislation, HB 1235 received wide support from legislators as it moved through the process in the spring session and passed in its final form the day before session ended.
 
Other states that have passed PLS legislation include Connecticut, Maryland, Nebraska, North Carolina, Washington, Maine and Rhode Island. New York has passed a bill that is currently awaiting the signature of Gov. Andrew Cuomo.

College an investment worth saving for, GCUA survey finds

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DULUTH, Ga. (7/9/14)--In a recent survey by Georgia Credit Union Affiliates (GCUA), more than 71% of respondents said saving for a college degree is worth the financial investment, with 60% answering that saving for college in general was important to them.

The Mid-Year 2014 Consumer Survey also found that only about 20% of people believe students loans are a good way to pay for a college education, a result that could be driven by ever-escalating costs to attend college.

A recent evaluation of college pricing, reported by GCUA, found that as prices rise for education, so does student debt.

But considering the long-term benefits of receiving a college degree--Americans with a four-year degree make an average of 98% more than those without, according to the Economic Policy Institute in Washington--people still find it imperative to save.

"With tuition costs on the rise, it is important for consumers to begin planning their financing as soon as possible," said Laura Sterling, vice president, Georgia's Own CU, Atlanta, with $1.9 billion in assets. "Even if you have been proactively saving for college, it does not guarantee you won't need financial assistance, and student loans are a great help."

GCUA offers several college savings-related tips, including starting to save as soon as possible, seeking assistance from a financial adviser and researching different ways to save for college.

Sterling, meanwhile, suggests the types of questions those considering taking out a student loan should ask themselves before they sign on the dotted line.

"How much can you afford? Is the school worth the cost of education? How long will it take to pay back the loan?" Sterling said. "What kind of income will you make after you graduate, and what is the job market like in that field?"

Sterling also notes that federal student loans funded by the government can carry less risk and that they're often less expensive than other types of financing options.

"If you need assistance paying for college, it is generally a good rule of thumb to consider federal loans first," Sterling said.

Kansas CUs report solid 1Q results

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WICHITA, Kan. (7/8/14)--Kansas credit unions posted solid first quarter results, including loan growth of 9% that exceeds the national average of 8.8%.
 
Auto loans and credit cards ticked upward at 11.4% and 10.1%, respectively, followed by a strong showing of first mortgages with 7.8% annual growth, according to the Kansas Credit Union Association ( Vision July 1).
 
Members continue to deepen their relationship with their credit unions with an average relationship--outstanding loan and share balances combined--coming in at $12,937 with a 4.1% annual growth rate.
 
Kansas credit unions added nearly 16,000 members over the past year--an annual growth rate of 2.5%.
 
For the first quarter, credit quality remains high. At 0.74%, Kansas credit unions have a lower delinquency rate than local banks as well as banks and credit unions nationwide.

Law fraternity makes the case for CU benefits

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TOWSON, Md. (7/8/14)--In an article titled "Credit Unions: for your Chapters and your life," a member of Phi Alpha Delta Law Fraternity International, based out of Towson, Md., wrote on the fraternity's website about the numerous advantages of credit unions compared with banks.

"For some reason I thought it made sense that the banks I was using should charge me all sorts of fees for me to use my own money," wrote Byron K. Rupp, director for the fraternity's pre-law operations and the article's author on pad.org . "Then I looked into credit unions and realized that I could (receive) all of the same benefits ... but instead a credit union would give me money (and lower interest rates) to use my money."

Since the discovery, Rupp said, he's been a credit union convert.

After listing several ways in which credit unions differ from banks--including that they're not-for-profits that return revenues back to members through free ATM use, offer lower interest rates and fewer fees, and are governed by democratically elected boards of directors who live by "one member, one vote" philosophies--Rupp explained why credit unions are important to fraternity chapters and their operations.

"It seems to be getting harder to find a bank that will offer our chapters free checking accounts," Rupp wrote, adding that he recently received an email from one chapter that had lost more than $200 to their current bank in fees alone over the last year.

"The idea that a Charter should do significant fundraising just to pay bank fees is pretty appalling," Rupp said. "Simply put, why should you pay a bank for the right to use your own money?"

CU System briefs (07/08/2014)

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  • RADCLIFF, Ky. (7/8/14)-- Ray Springsteen took over Wednesday as president/CEO of Fort Knox FCU. Springsteen, who previously served as executive vice president, succeeds William J. "Bill" Rissel, who retired after 23 years as CEO of the $1.1 billion Radcliff, Ky.-based credit union ( The News - Enterprise July 6) ...
  • ARLINGTON, Va. (7/8/14)-- The National Association of State Credit Union Supervisors recently approved the reaccreditation of the Alabama Credit Union Administration (ACUA) and the Washington Department of Financial Institutions (DFI) Division of Credit Unions. The ACUA, which is led by Sarah H. Moore, supervises 65 credit unions with combined assets of roughly $10.7 billion. The DFI, led by Scott Jarvis, supervises 62 credit unions with combined assets of about $35.9 billion ...

First-generation American shares financial challenges

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LOS ANGELES (7/8/14)--Jennifer Calonia, editorial manager for GOBankingRates.com , recently shared the financial challenges she faced as a first-generation American--information credit unions can use to meet the financial needs of their memberships, especially financial education.
  • Finding cash for college. "My parents and family insisted on me getting an good education," Calonia wrote. "Throughout my childhood, I was told that a college degree--specifically one that would lead me to a career in medicine or law--would be my gateway to a successful life. As a kid, I bought into that notion, and had aspirations to become a pediatrician, but at 10 years old, I didn't fully understand the financial implications of that educational path."

Calonia did not have a 529 savings plan to fund her tuition. Her parents worked hard and provided a safe, loving environment, but they didn't have the resources their daughter's college education. Nor did they know the ins-and-outs of where to find financial aid.

  • Navigating the contradictions of the American dream. "Growing up, I heard stories from my grandparents, aunts and uncles about how hard life was back in their native country, and how some people there assumed that anyone in the U.S. had the means to buy luxury cars and lavish homes," Calonia wrote. "My first experience visiting the Philippines confirmed the prevalence of this idealized notion of the American lifestyle."

At the same time, Calonia's budget for the trip to the Philippines was so tight that she could only afford to bring $50 in spending money for the entire trip. She was $25,000 deep in student loan debt, had $2,000 in credit card debt and couldn't even afford a car. "It was at that moment that I learned how disconnected the foreign perception of the American dream can be to the cost-of-living realities Americans face daily," she wrote.

  • Learning by trial and error. "Unfortunately, in my house, discussions about money were very polarized--either I should behave one way, or shouldn't--but there was no conversation about how to improve upon my parents' experiences," Calonia wrote. "So there were no talks about the pros and cons of credit card use, or how to be responsible with debt, or even what it meant to have a line of credit. All of those lessons, I had to pick up along the way, without my family's help."

Filene offers 4 steps to further women's leadership

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MADISON, Wis. (7/8/14)--Women at credit unions with female CEOs feel more effective, that their skills are move valued, and that they are more committed and competent. Those were among the key takeaways at a Women in Leadership Colloquium hosted by the Filene Research Institute and World Council of Credit Unions at the University of Southern California last month.
 
In short, female CEOs change the possibilities for other women in their organizations, according to colloquium participants. On important measures such as ambition, competence and self-perception, women with female CEOs rated higher than those at credit unions led by men.
 
The colloquium offered four first steps to address the gender intelligence challenge:
  • It's essential for women (and men) to differentiate between mentors and sponsors, participants said. Mentors offer advice and encouragement, but sponsors do that and more, by using their own political capital lobbying for your next raise, promotion or new job.
  • Boards and hiring executives should exercise their influence by demanding diverse candidate slates for important positions. The more search firms and human resource departments see diversity consideration as a necessary step, the more they will emphasize it in their own steps.
  • Women in organizations with visible female leaders feel more empowered and are more engaged. Each organization should feel responsible for building a "first generation" of powerful women so that up-and-coming women have role models and potential sponsors.
  • Credit unions should track data about how many women are leading in their organizations. This allows the organization to know whether women leaders are arriving by accident or intentionally. It also helps the organization determine if it is improving.

Select FCU fills payday lending gap in San Antonio

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SAN ANTONIO (7/8/14)--Select FCU is providing consumers with access to affordable funds after the city of San Antonio filed a lawsuit against seven payday lending establishments that were allegedly in violation of a city ordinance.
 
The ordinance requires payday and auto-title lenders to register with the city, pay a fee, and limits the amount of the loan. Perhaps the biggest challenge is enforcement. If the city's lawsuit prevails, it will be a major victory for the regulatory effectiveness of city law.
 
To be effective as a replacement for payday lenders, SFCU first had to establish a presence where the loans were needed. The credit union established a branch at the Ella Austin Community Center.
 
"We want to dedicate this branch to sitting down and talking with people," John Garcia, head of business development and marketing at $33 million-asset credit union, told The Rivard Report (July 7).
 
The credit union is also working on other partnerships with local businesses and institutions to bring virtual or mini-branches to their facilities.
 
The credit union doesn't want to simply offer loans, it wants to help members obtain financial stability, Garcia said.
 
SFCU is a designated community development financial institution, one of only two in San Antonio. As a CDFI, the credit union identifies members who seem to be relying on payday loans for non-essential costs and can offer financial counseling to help them curb their spending.
 
SFCU is also working with the City of San Antonio to align lenders for applicants who want to move into Wheatley Courts, a former Section 8 development that being transformed into mixed-income housing.

ACUC: A packed, powerful week for attendees

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SAN FRANCISCO (7/8/14)--It was a packed week for the Credit Union National Association's 2014 America's Credit Union Conference in San Francisco, with a schedule chock-full of educational breakout sessions, stirring speeches and even the occasional excursion throughout the city.  

Click to view larger image Attendees of the Credit Union National Association's 2014 America's Credit Union Conference in San Francisco wear "100 million membership" T-shirts to the final keynote address of the week on the conference's last day Thursday. (CUNA Photo)
From June 29 to July 3, roughly 1,200 attendees had access to a wealth of credit union resources such as networking opportunities with other professionals, Q&A sessions with inspiring keynote speakers and ample time to pick the brains of vendors at the daily exhibit hall.

The vendors also find the experience valuable.

"What I like about ACUC is the people, everybody is very friendly, very open, very questioning, and they want to learn," Abbe Mahaffey, Diebold director of integrated services, told News Now . "Everybody is excited to be here, everybody is excited to see each other and work together and learn from each other."

The general sessions, emceed by TV personality Mark DeCarlo, featured a varied lineup of keynote addresses, capped Thursday with former U.S. Navy SEAL Marcus Luttrell's enthralling story about how he survived an ambush in Afghanistan in 2005--a tale recently recaptured by Hollywood in the movie "Lone Survivor."

Conference attendees also heard from a National Credit Union Administration official on the NCUA's reasoning behind and current stance on the controversial risk-based capital proposal at a heavily attended special general session during the week.

The main takeaway was that the NCUA will use as long as it takes to put together the "right" capital requirement regulation for credit unions, according to Larry Fazio, NCUA director of the Office of Examination and Insurance.

Attendees also enjoyed using a social media app that CUNA created specifically for the conference. The app featured the conference schedule, allowed attendees to interact and post photos and comments about their experiences and highlighted bios of the various speakers, sessions and events.  

Other highlights from the conference included:
  • A selfie kiosk outside the general session ballroom where conference attendees could take photos of themselves to be posted on CUNA's new website, www.americascreditunions.org , for its recently launched 100 million membership campaign;
     
  •  Young credit union professionals sat in on an executive series session where they were able to listen to top industry leaders discuss the most pressing issues facing credit unions today;
      
  • Industry trend educational talks such as "Engineering the Right Branch Experience," "Creating Member Loyalty," and "Serving Members Who No Longer Need Branches;" and
     
  •  An experimental breakout session at San Francisco's Exploratorium Museum.On

Thursday, DeCarlo also teased next year's conference, which is set to take place in Denver July 12-15. In conjunction with the World Council of Credit Union's annual conference, the week is expected to take on an international twist.

ACUC: CUs should help members navigate changing waters of retirement

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SAN FRANCISCO (7/7/14)--Longevity, demographics and the economic climate are coming together to take the polish off retirement's "golden years," and credit unions need to be prepared, advised a CUNA Brokerage Services Inc. (CBSI) speaker at the Credit Union National Association's 2014 America's Credit Union Conference last week.
 
"Most baby boomers don't have a retirement income plan or a plan for funding long-term care. That's where the credit union fits in," Hendrix Niemann, managing director of wealth management, CUNA Brokerage Services Inc., tells a Discovery breakout session audience at the Credit Union National Association's 2014 America's Credit Union Conference. "Credit unions have a major role to play in educating their members about these issues and helping them navigate the new normal environment." (CUNA Mutual Group Photo)
"Credit unions are facing major changes to their membership and their asset base," said Hendrix Niemann, CBSI managing director of wealth management. "Baby boomers are starting to enter retirement, which means their money will be leaving the credit union as they spend down what they have saved and invested for 30-40 years. They will not be borrowing or depositing."
 
He told the Discovery breakout session audience that credit unions need to have a concrete plan in place for replacing those assets and also for retaining assets that are going to be passed on to the next generation.
 
Niemann said that in the past 800 years there are no documented examples of an economy that had to emerge from a financial crisis while simultaneously absorbing the effects of an aging population.
 
"Two-thirds of all the people in the history of the world who have lived past the age of 65 are alive today," said Niemann. "People didn't use to age. They died."
 
Today, the average 65-year-old male has a 50% probability of living to be 85 years old, with the average 65-year-old female living to be 87--making the average length of retirement 21 years. If the person is part of a couple, there is a 50% chance one of them will live to be 91, which makes the average length of retirement jump to 26 years, Niemann told audience members.
 
"Many people don't realize it, but we've entered a new normal for retirement," said Niemann. "The golden age of retirement is not coming back. Many credit union members think it will, but it's not coming back."
 
The baby boomers are the largest generation in U.S. history ever to retire--and the vast majority of them have not saved enough for retirement. When they realize this, they postpone retirement or re-enter the workforce.
 
"The boomers are relying on social safety net programs, such as Social Security and Medicare, that were never designed or intended for a large contingent of beneficiaries who will probably live 25 or 30 years--or more--in retirement," he said, adding, "Those programs, under their current models, will be unable to pay the benefits seniors believe they are entitled to."
 
Today, there are 30 million fewer people in Generation X than in the baby boomer generation, which means 30 million fewer people paying into the retirement system for this massive retiring population.
 
The effects of these demographic trends are exacerbated by fundamental changes to the U.S. economy since the 2008 financial crisis and the start of the "new normal" economy we're currently in, he added.
 
"The bottom line is this--what retirement looks like, or will look like, for those in retirement or about to retire may be a lot different than they thought it would be," said Niemann. "There's a very real and valid fear among retirees that they will outlive their assets or run out of money because their nest egg is simply not large enough, particularly because they have not saved for out-of-pocket health care costs in retirement that are not covered by Medicare."
 
Niemann told his audience they can expect these fears to escalate among members as credit unions' membership continues to age.
 
"Members need credit unions more today than ever before, but they just don't know it, yet," said Niemann. "Most Baby Boomers don't have a retirement income plan or a plan for funding long-term care. That's where the credit union fits in. Credit unions have a major role to play in educating their members about these issues and helping them navigate the new normal environment."
 
Niemann concluded his session by encouraging credit unions to help members, old and young, navigate these changes by starting the conversation.
 
"Don't wait for members to come to you. Reach out to them. Ask members to visualize their future, and then help them figure out a realistic retirement plan," said Niemann. "Credit unions have the knowledge, expertise, and resources to help members navigate these changes, but they can't delay. They must start today."
 

Community helps choose winners of CU's GROW grants

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PORTLAND, Ore. (7/7/14)--Advantis CU turned to the Portland, Ore., community to help decide which of 12 nominated nonprofit groups should be the beneficiaries of grants from its $50,000 GROW Community Fund.
 
The six winners were determined by more than 37,000 votes cast on Facebook and the $1.1 billion-asset credit union's website.
 
This year's grant recipients are:
  • Cafe au Play, Portland, will receive $10,000 to support the Barista Training Program, which provides free job skills training to local high school students.
     
  • North Clackamas Education Foundation, Clackamas, will receive $6,500 to purchase musical instruments to help provide all students with equal access to music education.
     
  • Portland Institute for Contemporary Art will receive $3,500 to fund the youth programming portion of its Time-Based Art Festival Sept. 11-21.
     
  • Rose Haven, Portland, will receive $10,000 to purchase paint and furniture to refurbish the facility, which supports homeless and abused women and children.
     
  • The Pixie Project, Portland, will receive $10,000 to build three permanent shelter kennels for dogs awaiting adoption.
     
  • Trillium Family Services, Portland and Corvallis, will receive $10,000 to support access for its mental and behavioral health clients to safe recreation including new basketball hoops and pouring new concrete sport courts.
"Supporting the communities we serve is an essential part of Advantis' commitment to being a local credit union," said Senior Vice President/Chief Administrative Officer Wendy Edwards. "We share the same passion for these organizations that our members and communities do."

CU System briefs (07/07/2014)

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  • WARMINSTER, Pa. (7/7/14)-- Forget about a polar bear plunge --Freedom CU staffers slid into sloppy Jell-O to benefit the Kids-N-Hope Foundation. During the 21st Annual Gelatin Olympics, Frank Dwyer, senior network engineer of the $647 million-asset credit union, dressed like a hula dancer and glided into 700 gallons of strawberry gelatin. He also took home the awards for best costume and top donor at the June 11 event. The Warminster, Pa., credit union donated $700 to the Kids-N-Hope Foundation, which supports programs such as music therapy for the Children's Seashore House at the Children's Hospital of Philadelphia (Freedom CU Photo) ...
  • MADISON, Wis. (7/7/14)-- Jim Metz, president/CEO of CUNA Brokerage Services Inc., will retire from CUNA Mutual Group's broker-dealer . "Since Jim joined CUNA Mutual Group in 2006, he has provided strong leadership to CUNA Brokerage Services Inc., as president and CEO of our broker-dealer business," said Mike Defnet, senior vice president of sales and marketing. Metz has more than 26 years in the insurance and investment business ...
  • MADISON, Wis. (7/7/14)--As the second half of 2014 gets under way, many credit unions will have a different course for the rest of the year because of recent mergers. Tri-Co FCU, a $134 million-asset credit union in Randolph, N.J., merged with $3.3 billion-asset Visions FCU, Endicott, N.Y., July 1 . All four branches of the education-based credit union and its ATM locations will remain open ( Central New York Business Journal July 2). Federal Employees CU, Des Moines, Iowa, with $19 million in assets, merged with Collins Community CU, Cedar Rapids, Iowa, with $773 million in assets. The merger was effective July 1 after an affirmative membership vote by the smaller credit union. Federal Employees CU also has branches in the Iowa City VA Medical Center and the federal building in downtown Des Moines, which will be kept open ( The Gazette June 28).  Grand Island, Neb.-based NAFCO Nebraska FCU, with $2.7 million in assets, will merge with SAC FCU, Papillion, Neb., with $705 million in assets, by Aug. 1 ( The Daily Nonpareil June 29). NAFCO Nebraska's field of membership included employees of Michigan-based SpartanNash, its affiliated stores and their immediate families. Members of Greater Minnesota CU, Mora, Minn., with $145 million in assets, voted in favor of a merger with SPIRE FCU, Falcon Heights, Minn., with $626 million in assets. The merger will make SPIRE the third-largest in the state of Minnesota, according to the credit union ...

N.Y. CUs raise $83K for charity at annual convention

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ALBANY, N.Y. (7/7/14)--Attendees of the Credit Union Association of New York's annual meeting and convention participated in several fundraising initiatives, netting more than $83,000 for three causes: the New York Credit Union Foundation, the state-level Credit Union Political Action Committee (CUPAC) and the Children's Miracle Network Hospitals that serve New York.
 
The four-day event, held June 19-22, drew nearly 700 New York credit union professionals, volunteers and suppliers to the Saratoga Hilton at City Center in Saratoga, N.Y.
 
"On behalf of New York's credit unions, I would like to thank everyone who made this year's convention such a great success," said William J. Mellin, league president/CEO. "Over the course of just four days, we were able to raise more than $83,000, illustrating--once again--that New York's credit unions truly are 'United for Good.'"
 
Among the fundraising activities the group participated in:
  • New York Credit Union Foundation: Through sponsorships and credit union support for the annual golf tournament held June 19 and June 21, CUNA Mutual Group provided  the foundation with more than $40,000.
  • Credit Union Political Action Committee (CUPAC): By supporting the annual bingo event and silent auction, convention attendees raised more than $19,000 for CUPAC.
  • Children's Miracle Network Hospitals: Through sponsorships, donations and a match from CO-OP Financial Services' Miracle Match program, a wine pull to benefit the Children's Miracle Network Hospitals that serve New York raised more than $24,100.

Tablets gateway to banking for 138M by 2018: Javelin

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SAN FRANCISCO (7/7/14)--With tablet adoption cresting the 50% crossover point, consumers are using smart devices for their mobile banking, with a third viewing and paying bills via the devices, according to recent research by Javelin.
 
About 1 in 3 consumers use tablets as the primary device to email financial institutions (FIs), and Javelin estimates about 138 million adults will use their tablets to access their accounts by 2018.
 
"The biggest constraint to consumer tablet banking in the next several years is the speed at which FIs adapt to consumers' changing technology needs to provide robust tablet banking apps, especially for the complex Android market," said Mary Monahan, Javelin executive vice president and research director of mobile. "FIs have worked diligently to finesse mobile banking for smartphone users, but they are less prepared for tablet bankers."
 
Users also are turning to tablets at higher rates to perform advanced mobile banking tasks, according to Javelin's "Tablet Banking Forecast 2014--2018: Design and Deployment Strategies for Mass Adoption."

ACUC: 'Lone Survivor' Luttrell captivates, caps conference

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SAN FRANCISCO (7/7/14)--The story told by Marcus Luttrell, a former U.S. Navy SEAL who narrowly escaped certain death after being ambushed by a large Taliban force during a mission in Afghanistan in 2005, was nothing short of captivating.
 
Click to view larger image Marcus Luttrell, a former U.S. Navy SEAL, carries his message of "You go up together, and you go down together," during his appearance at the Credit Union National Association's 2014 America's Credit Union Conference. As Luttrell prepares to close the final general session, his service dog, Rigby, waits in the wings. (CUNA Photo)
The credit union crowd Thursday at the final general session of the Credit Union National Association's 2014 America's Credit Union Conference, seemed to hang on every word that the self-described "Texas-boy gunfighter" said.
 
The horrific sequence of dozens of enemy fighters ambushing Luttrell and three other squad-mates. The levity injected into the heavy material, as he joked about the mistakes the filmmakers made in recreating the story in "Lone Survivor." And the recounting of the terrible moments when he realized that his friends--his brothers--had been killed.
 
But the part of the story that may have resonated most with the credit union professionals in the room, people who themselves have made commitments to serve connected groups of members and communities, came at the beginning.
 
Luttrell shared how he as a teenager, his twin brother and several childhood friends approached a local resident of their hometown to train them for the special operations forces.
 
A Vietnam veteran, he was the first to teach Luttrell that teams, especially those in the U.S. Army Special Forces, succeeded and failed together.
 
"To kind of give you a little background on this joker--those of you from small towns you can appreciate this--he was our town psychopath, alright?" Luttrell said. "Literally, he was the guy you see in the supermarket just screaming at the bread."
 
"But," Luttrell continued. "He could get you right; he could get you ready to go into the Special Forces."
 
The very first exercise this man put them through was to do 300 pushups together, in unison, at 4:30 in the morning.
 
"We start trying to bang these pushups out, and we got to about 200 and something, and eventually some of us were going down while the rest of us were coming up," Luttrell said. "And he says, 'Stop what you're doing. As a team you're going to go down together, and you're going to come up together. You're going to live together, you're going to die together. You guys are a team. And you're going to start over.'"
 
The group repeated the exercise several times, and each time they failed to stay together, until their trainer, Billy Shelton, sent them home.

Though they may have failed, the message--one that Luttrell carried with him as a U.S. Navy SEAL--was delivered loud and clear: You go up together, and you go down together.

ACUC: CUs need to adapt to serve the un-branched member

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SAN FRANCISCO (7/7/14)--Like it or not, with consumers able to carry around mobile bank branches on their smartphones and tablets, credit unions, like all financial institutions, are going to have to figure out ways to adapt to the change in the way members receive financial services.
 
In addition to the unbanked, credit unions need to consider the "un-branched"--those members who do not need a physical location to conduct their financial transactions--consultant Tim Harrington advises during last week's breakout session at the Credit Union National Association's 2014 America's Credit Union Conference. (CUNA Photo)
"We're talking about those who don't need branches, and do you know who that describes? Everybody here," said Tim Harrington, president of T.E.A.M. Resources, a credit union consulting firm. "We may want branches, we may like branches, but the fact is we don't need branches except for a very few things."
 
Harrington--during his discussion Thursday at the Credit Union National Association's 2014 America's Credit Union Conference, called "Serving Members Who No Longer Need Branches"--described how various financial institutions are trying to get out in front of this evolution.
 
The image Harrington first painted for attendees was stark--anyone born after 2013 likely will never set foot into a physical branch location, at least according to research compiled by SAP.
 
But Harrington doesn't necessarily agree. Instead, he believes that rather than a mass-exodus of branches it's more likely they will simply feel and operate in much different ways in the future.
 
With traditional services almost entirely consumed by the capabilities of the digital mobile device, one way branches can evolve, Harrington said, is by offering non-banking-related products that could potentially drive consumers to the physical locations.
 
Harrington's first example of a financial institution taking this route was Capital One 360, which has opened up coffee shops that double as bank service centers throughout the United States. Each barista can switch hats and serve up financial guidance, in addition to that 12-ounce cup of coffee consumers may first have come for.
 
"If you spend time in their branch, chances are you're going to talk to a customer services representative and you're going to learn about their products and services," Harrington said.
 
This idea is slowly catching on throughout the national and international world of financial services, and in various forms. Credit unions and others are offering coffee, yoga classes, meeting spaces and more in order to drive consumers to their branches, consumers who don't need the old style of branch any longer and likely wouldn't have frequented the branch in the first place.  
 
Financial institutions also are creating micro-branches that keep services simple, and boutique branches that feel more like Apple stores--like Harrington's slide of an Indonesian bank branch--than the traditional credit union branch.
 
While Harrington said these methods are still largely untested, and not guaranteed to work, they demonstrate how financial institutions have acknowledged the evolution of the branch, and are testing ways to adapt.
 
Further, even if the methods prove successful, the majority of financial services will continue to be driven by mobile technology, which will still limit a credit union's ability to sell products through its physical branches.  
 
So, Harrington posed--citing a study that found that financial institutions are making 25% fewer transactions per month than they were five years ago--how do you sell products to members you never see?
 
By building a relationship with them, and maximizing the time with the member, whenever and wherever contact can be made whether it's on the Web, through social media, on the phone and even the rare in-person opportunity, he said.  
 
"Physical branch locations will still be important to attracting people and handling complex transactions," Harrington said. "But it's going to change."

ACUC: Be aware of continued shifts in mortgage rules

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SAN FRANCISCO (7/7/14)--The Consumer Financial Protection Bureau (CFPB) changed the fundamental nature of how credit unions go about their day-to-day lending activities, CUNA Mutual Group's Regulatory Compliance Manager Jon Bundy told a Credit Union National Association America's Credit Union Conference Discovery breakout session audience last week.

CUNA Mutual Group's Regulatory Compliance Manager Jon Bundy speaks to an America's Credit Union Conference (ACUC) Discovery breakout session Thursday. (CUNA Mutual Group Photo)
"Credit unions have spent the past six months adjusting to the CFPB's new mortgage rules, and they're not done, yet," said Bundy.
 
Credit unions have implemented six new mortgage rules in 2014 with a seventh mortgage rule compliance deadline looming in 2015. In total, the CFPB issued more than 6,400 pages of new regulations for credit unions to comply with.
 
Bundy reminded the audience that each new mortgage rule has a different scope, and that many of the new rules apply to both open-end and closed-end loans. Almost all of the new mortgage rules impact dwelling-secured transactions, including motor homes, RVs, trailers, and boats, Bundy added.
 
"If you do any lending secured by a dwelling, you will be impacted," said Bundy. "And that includes small credit unions, too."
 
There are very few exceptions for small creditors and small servicers, which can be confusing because there are different definitions for small creditor relief in different rules. Bundy recommended credit unions take time to read each rule carefully to ensure compliance.
 
Bundy continued his session by engaging ACUC session attendees in a discussion about each new mortgage rule, and the pain point's credit unions have experienced while implementing the rules as well as how to avoid these pains.
 
"Stay focused, take time to understand the changes, and make adjustments where necessary," Bundy said. "Doing these things combined with a positive outlook and understanding what you can control will do more for your credit union than focusing on the pains of change."
 
Bundy continued the session by giving attendees a glimpse of what's on his radar for regulatory compliance, including the expedited funds availability act (Regulation CC), business lending data act (Regulation B), and home mortgage disclosure act (Regulation C), as well as educating audience members on the CFPB's enforcement activities, including student lending and indirect auto lending, and consumer education efforts, too.
 
"Keep in mind, the CFPB is not done, yet," Bundy said. "Looking at what the CFPB plans to accomplish in the next couple of years is daunting, but you have the tools to succeed as long as you start adapting now."
 
Bundy recommended credit unions prepare for a fast pace of compliance change by investing time, money and energy into developing a strategic plan and budget to navigate compliance risk and continue to implement the CFPB's changes.
 
"Be an active participant with the CFPB by taking part in the comment process," he said.  "Provide real examples of the cost of compliance and impact for members, and be sure to take the long view of educating the CFPB on the value of the credit union movement. In the end it will all be worth it," he added.

Hope FCU steps in to fill empty space left by bank

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TERRY, Miss. (7/7/14)--The opening of a Hope FCU branch in Terry, Miss., last week brought much needed financial services back to the town. Just as importantly, it introduced the credit union services to the town of 1,063 residents.
 
The town's only bank, Regions, closed in March, forcing residents to drive about 15 miles to Jackson for their financial service needs ( The Clarion-Ledger July 3).
 
Soon after, Terry residents began efforts to bring Hope FCU to town. After an initial meeting drew 40 enthusiastic residents, Bill Bynum, CEO of the $187 million-asset credit union, which is based in Jackson, kept in weekly contact with Terry Mayor Rod Nicholson.
 
Regions agreed to donate the former bank building to Hope FCU, a gesture that helped the credit union open the branch much sooner, Bynum said.
 
"Today's celebration is a testament to what can happen when the community comes together to work towards a common goal," said Bynum said at the branch opening last week.
 
The decision to open a branch in Terry is part of HOPE's five-year strategic plan to double the number of places and people served--particularly in bank deserts. Bank deserts are defined by the U.S. Postal Service as a ZIP code in which fewer than two bank branches exist.
 
For local people, the opening of the branch is a welcome sight. "I've been a member and maintained my business account with HOPE for a number of years and they've always provided high quality products and services," said Debra Hunter, a small business owner and resident of Terry. "By opening a branch on Main Street, the credit union is not only bringing HOPE to downtown, but to all of the people who live in Terry."

Cybersecurity is responsibility of more than IT, says CMG

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SAN FRANCISCO (7/3/14)--Cyberliability exposures continue to evolve, and credit unions can no longer rely solely on their information technology staff to ward off a cyber attack. Network security now requires solid governance and oversight with active participation by management and the board of directors, CUNA Mutual Group's Jay Isaacson told a Discovery session Wednesday at the Credit Union National Association's 2014 America's Credit Union Conference in San Francisco.
 
Isaacson, CUNA Mutual Group's vice president of commercial products, said data breaches are increasing across all businesses, resulting in significant dollar losses and reputational damage. He cited the Verizon 2014 Data Breach Investigation Report, which indicated 1,367 data breaches occurred in 2013, with 465 involving the finance industry.
 
And the price tag is high. In May, the Ponemon Institute reported in its Cost of a Data Breach Study, the average total cost of a data breach was $3.5 million, with a global average cost of $145 for each lost or stolen record containing sensitive and confidential information.
 
"Think of your own credit union and do the math. While a data breach might seem somewhat remote, it's within the realm of possibility and could threaten the safety and soundness of your institution," Isaacson said.
 
Within the financial sector, the most common security breach incidents involved Web application attacks, denial of services (DDoS) attacks, payment card skimming and insider misuse, according to the Verizon study. While financial gain motivates most data breach perpetrators, cyber espionage is also increasing. Isaacson said the most common sources of data breaches are hacking, followed by malware.
 
Specific to credit unions, Isaacson said the most common cyber claim themes reported to CUNA Mutual Group under its Cyber and Security Incident insurance coverage involved DDoS, third-party service providers, employee errors and lost or stolen devices.
 
"Network security is only as strong as the weakest link," he said. "You may have an air-tight data system, but if a third-party provider you use is lax, or a laptop containing confidential data goes missing, your credit union is at risk."
 
Isaacson said risk management considerations include education and training for all employees--not just IT staff; development and frequent testing of an incident/breach response plan; and the creation of a data security incident response team. Member education is also vital.
 
"There's a need to balance security and convenience," he said. "Members need to understand why certain security measures they might not consider convenient are necessary for their protection and the credit union."
 
He also encouraged attendees to consider transferring some of the risk to a cyberliability insurance policy. The two main components of a good cyberliability policy include expense coverage to assist in managing and mitigating a data breach and liability coverage to protect against related lawsuits.
 
In closing, Isaacson asked the audience to consider the following questions to help determine their level of preparedness for cyberattacks:
  • Does the credit union have an incident/breach response plan?
  • Is access provided to the necessary level of internal and external expertise to manage through a breach (IT professionals, public relations and legal counsel)?
  • Does the credit union understand the notification obligations and requirements in its state or any other state in which it has a record?
  • Does the credit union regularly review the controls and security of third parties housing your data?
  • Does the credit union have mechanisms in place to detect and react to potential DDoS attacks?
Be sure to visit  News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

ACUC: There's no magic pill for attracting young members

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SAN FRANCISCO (7/3/14)--With seemingly infinite competition for the attention of young consumers, it's not a surprise a credit union marketing expert who presented strategies Wednesday on how credit unions can attract younger generations led off his discussion with a stark message. 

There is no magic pill that will miraculously make your credit union attract younger members.

"I don't have that," said Tim McAlpine, who heads the Canadian marketing company Currency, during his breakout session at the Credit Union National Association's 2014 America's Credit Union Conference.

McAlpine said that even though it is not always easy to chart a marketing course to attract younger consumers, the reasons to do so are compelling. Generations Y and Z, or those born after 1980, make up more than half the U.S. population, making it crucial for credit unions to appeal to them.

Further, credit unions in particular must be mindful of these youthful demographics, as the average age of a credit union member continues to climb. In the United States it has reached 48, which is nearly 10 years older than the North American average.

"This should be a major concern," the marketer said.

McAlpine also discredited the assertion that less effort should be expended marketing to young people because they don't have any money.

While that may or may not be true now, a massive transfer of wealth from Baby Boomers and older generations to their children is on the horizon, he said. An amount of money some estimate could total $40 trillion over the next 30 years is about to change hands and studies show it will be searching for a new home.

McAlpine said that after receiving inheritances, 98% of people transfer to a new financial institution, a fact that essentially puts the $40 trillion in play over the next few decades.  

Another reason McAlpine offered for credit unions to get into the young-person game was to beat back the mega-banks who are "swallowing" the market.

"The absolute dominance of the top 100 banks is the real elephant in the room," McAlpine said. "So while credit union market share has increased slightly over the last 20 years, the community bank share has dropped by nearly two-thirds, literally being swallowed by the big banks."

Be sure to visit  News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

CUs told to 'humanize' digital banking experience: ACUC

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SAN FRANCISCO (7/3/14)--There's a "seismic shift" that nontraditional providers are causing in the financial services industry, James R. Lay told America's Credit Union Conference attendees Wednesday.

"It's time to admit the traditional banking model is broken and flawed," Lay said. "The banking industry is at high risk of disruption."

Add to that the fact that young adults aren't showing traditional financial institutions much love. Lay cited a recent survey that revealed 71% of Generation Y respondents would rather go to the dentist than to a bank--and that 33% believe they don't need a bank at all.

The remedy? Digital "storyselling," he told the Credit Union National Association conference attendees, where credit unions use member stories to position and sell their products. "People trust people--and they buy stories, not features. The key to success is humanized content and distribution channels."

He advised taking a seven-step interconnected digital strategy that asks:
  • Who is the market segment? "Define the persona of your 'heroes'--targeted members--to document their challenges," he said. "The credit union is the guide."
  • What's your solution? Define how you can help your heroes overcome their challenges.
  • When does the hero need help in that journey? Define the help you will provide.
  • Where will you help them? "This is a critical piece that requires selecting a digital marketing platform," Lay said.
  • Why should they trust you? "Build credibility with your heroes by sharing stories of how you've helped others," he said.
  • How will you guide your heroes to success? Map your plan.
  • How will you tell a story that helps you grow?
"The time to act is now," Lay said. "We've seen the casualties: Borders, Blockbuster, Tower Records. They built businesses models based on the branch model.

"We have to change how we operate and generate leads," he continued. "That's through storytelling. It's the real moment that sells online. Those stories start with people--and that's the credit union model."

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

CUNA closed for 4th of July, no News Now Friday

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WASHINGTON and MADISON, Wis. (7/3/14)--The Washington, D.C., and Madison, Wis., offices of the Credit Union National Association will be closed Friday in observance of Independence Day.
 
News Now will not publish an issue Friday but will resume regular publication Monday.

Maine league presents annual awards

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WESTBROOK, Maine (7/3/14)--The Maine Credit Union League recently honored five credit union advocates as the recipients of the state's annual individual award program.

The recipients were recognized and presented with their awards at a ceremony held in Portland, Maine, in conjunction with the league's recent 76th annual meeting and convention.
 
Raymond Gagnon, board member, PeoplesChoice CU, Saco, with $155 million in assets, was recognized with the Alexander Ferguson Award for Outstanding Credit Union Volunteer. Gagnon helped found the credit union (formerly known as St. Joseph's CU) in 1953. He has served as a volunteer with the credit union ever since. Gagnon now serves in the role as board member emeritus.
 
Phil Moreau, president/CEO, Rainbow FCU, Lewiston, with $183 million in assets, was honored with the James M. Gratto Award for Outstanding Credit Union Manager. For the past 42 years, Moreau has served as president/CEO of his credit union. He has served several terms on the league board including service as chairman at two different times.  He currently serves as board treasurer. Moreau announced earlier this year his intention to retire on June 30, 2015.
 
Linda Howe, vice president of marketing and public relations, Down East CU, Baileyville, with $114 million in assets, received the Jeannette G. Morin Award for Outstanding Credit Union Employee. Howe was recognized for her work at the credit union and in the community, including winning a national Louise Herring Award from the Credit Union National Association, Maine State Chamber of Commerce Volunteer of the Year and numerous marketing awards. 
 
Howe gave her time to causes such as hunger relief, the Children's Miracle Network and youth financial education.  Receiving the award was Howe's last "official" work duty, as she had previous announced her retirement at the conclusion of the convention.
 
John Doe, board chair, Eastmill FCU, East Millinocket, with $60 million in assets, was recognized with the League President's Award for Outstanding League Volunteer. A volunteer for 28 years, Doe also serves as president of the Northern Penobscot Chapter of Credit Unions. Since 2000, Doe has also served on the Maine Credit Union League's board of directors. Doe, a retired educator who held a variety of positions including superintendent of schools for several school districts, is also active in youth financial education and is a high school basketball referee.   
 
Veronica Levesque, assistant vice president of accounting, Maine Savings FCU, Hampden, with $278 million in assets, was honored with the Diane L. Oceretko "People Helping People" Award.  A 25-year employee of the credit union, Levesque was described as the credit union's "driving force behind all of our community projects including ending hunger, Susan G. Komen Race for a Cure, MDA, Children's Miracle Network and many others."

ACUC: Supplemental retirement can help fight exec 'churn'

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SAN FRANCISCO (7/3/14)--To keep and attract executive talent, credit unions should look to supplementing their retirement plans, a CUNA Mutual Group benefits specialist told a Wednesday breakout session at the Credit Union National Association's 2014 America's Credit Union Conference.
 
"Your top talent is feeling financially vulnerable," said Bruce Bauer, CUNA Mutual Group senior executive benefits specialist. Supplemental executive retirement programs are tools credit unions can use to recruit, retain and compensate executives, Bauer told a Discovery session at the Credit Union National Association's 2014 America's Credit Union Conference Wednesday. (CUNA Mutual Group Photo)
"Jobs are opening up, executive talent is being aggressively wooed away from you, and your top talent is feeling financially vulnerable," said Bruce Bauer, senior executive benefits specialist. "Credit union executives who might retire at only 40% of their current salary may seek other employment options."
 
Given the restrictions on retirement plan contributions and distributions, many credit union CEOs may end up retiring at 30%-40% of their salary, even after including Social Security and 401(k) plan savings.
 
Non-qualified compensation options, such as supplemental executive retirement programs (SERPs), are tools credit unions can use to recruit, retain and compensate executives.
 
Nearly 50% of U.S. employers are challenged to fill mission-critical positions, according to a 2012 Manpower Group Talent Shortage Survey, and 63% of organizations say other companies are trying to recruit their leadership.
 
SERPs--which include 457(b) and 457(f) plans and split-dollar life insurance--are non-qualified retirement plans that can be coupled with a strong continuing education program to form the foundation of a solid leadership continuity program. "Maintaining your bench strength can prevent disruption in the attainment of your credit union's strategic and financial goals while providing consistency in decision making," Bauer said.
 
Proper due diligence is a must to analyze the risks associated with a SERP, evaluate alternatives and determine required ongoing regulatory reporting.
 
When developing compensation plans, Bauer recommended credit unions:
  • Align compensation philosophy with their mission, organizational and financial goals;
     
  • Encourage leadership continuity by defining a scope that addresses the CEO and key executives;
     
  • Use peer compensation data to establish a desired level of competitiveness and include it in their overall succession plan; and
     
  • Ensure regulatory soundness by working with a firm with a trusted long-term service commitment. Consider their ability to provide flexible designs, top products and funding options, exceptional knowledge and strong regulatory adherence.
Be sure to visit  News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

AmberMac: Successful social media means staying in the fast lane

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SAN FRANCISCO (7/3/14)--Amber MacArthur, president of Konnekt Digital Engagement, quoted
Click to view larger image When Amber MacArthur (shown here at the America's Credit Union Conference) discusses social media and technology trends, she quotes race car driver Mario Andretti: "If everything seems under control, you're not going fast enough." (CUNA Photo)
 race car driver Mario Andretti when discussing social media and technology trends: "If everything seems under control, you're not going fast enough." 
 
MacArthur, addressing the Credit Union National Association's America's Credit Union Conference Wednesday, said her 2010 book in which she wrote about the ABCs of social media--authenticity, bravery, consistency--is about 70% irrelevant today.
 
The social media maven offered eight social media best practices:
  • Protect your digital reputation. Musician Dave Carroll witnessed  United Airlines baggage handlers "chuck his Taylor guitar." When he complained about the damage, he received no response from the airline. So he made his own video on YouTube: "United Breaks Guitars." According to MacArthur, "this was the moment things changed" in the social media world. 
  • Put the right person in charge. Don't allow accidental tweets to damage your reputation. If you use a social media dashboard, don't combine personal and business Twitter accounts, for example. And create social media policies.
  • Follow contagious trends. Don't reinvent the wheel, she said. "Study Like a Scholar"--a YouTube video about the library at BYU--is a takeoff on an Old Spice commercial. When credit unions gather in Denver next year, MacArthur hopes a credit union will have done its own version of this video.
  • Beware of the social media storm. Be mindful of national and regional events, such as a Superstorm Sandy, that might make your social media efforts inappropriate. "Social media distribution happens quickly," she said.
  • Increase visual social media. Adding video or pictures to your social media will bump engagement by 50%.
  •  Set member expectations. "About 42% of Twitter users expect answers to questions within an hour," MacArthur noted. That's not realistic. Manage expectations like Florida Power & Light Co. does, by posting Twitter hours.
  • Share authentic moments. Tell stories about your community and member service.
  •  Build a mobile-friendly home base. How does your home page or website display on mobile? "That's where you should be driving everybody to," she emphasized. Responsive design websites will give you that flexibility no matter which device members use.
MacArthur told her ACUC audience she now has a new slate of ABCs: 
  • Adapt quickly. Lucky Charms remixed old commercials and found a new audience on YouTube.
  • Be responsive. Oreos quickly created a new commercial in the wake of the Super Bowl blackout last year ("You can dunk in the dark.") .
  • Create value. She used her #CUNAChat several weeks ago as an example, adding value to messages she planned to share today.
Be sure to visit  News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

CU loan growth fastest since 2005, MCUE survey reveals

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MADISON, Wis. (7/3/14)--Credit union loan portfolios jumped 1.2% in May, the most significant monthly increase in nine years, according to the Credit Union National Association's monthly sample of credit unions.
 
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The last time overall loan growth exceeded May's pace was August 2005. 
 
"Importantly, the increases were seen across the entire loan portfolio,"  Mike Schenk, CUNA's interim chief economist, told News Now .
 
New auto loans led loan growth, rising 2.6%, followed by used-auto loans (1.6%), unsecured personal loans (1.2%), home equity loans (1.3%), adjustable-rate mortgages (1%), credit card loans (0.9%) and fixed-rate first mortgages (0.1%).
 
"The U.S. economy floundered a bit recently--with a nearly 3% contraction in overall growth in the first quarter," Schenk said. "But we view the weakness as temporary--largely reflecting the lingering effects of the government shutdown/furloughs late in 2013 and, more importantly, a brutal winter across much of the United States. The loan growth were now seeing confirms our view that a second-quarter rebound is on the horizon.
 
Click to view larger image Click for larger view
"Low market interest rates, combined with a tremendous amount of pent-up demand, means we can expect more borrowing and lending during the summer months," Schenk added. "That, of course, should help to boost credit union bottom-line results as lower-yielding investments are replaced with higher-yielding loans."
 
Credit union savings balances grew 1% in May compared with a 0.5% decrease in April. Share drafts (5.0%), regular shares (0.8%), and money market accounts (0.5%) increased during May. On the decline were one-year certificates (0.4%) and individual retirement accounts (0.2%).
 
Total credit union membership grew 0.3% during May for a total of 99.9 million as credit unions prepare to reach the 100 million membership milestone.
 
The net capital-to-asset ratio held steady at 10.5% during May while the loan delinquency rate fell to 0.8% of loans outstanding.

ACUC: CUNA Chair Pierce dreams big for credit unions

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SAN FRANCISCO (7/3/14)--The early pioneers of the credit union movement, the likes of Edward Filene and Roy Bergengren, probably never dreamed that credit unions would ever touch 100 million memberships, a milestone the industry expects to realize later this year.

Back then, 80 years ago when the credit union movement began to gain steam, there may not have been many more than 100 million people living in the United States.

Click for slide show "If we're valid, if we have a purpose, and if we're providing something unique to Americans, I think credit unions have an opportunity to look back 80 years from now and celebrate similar kinds of success that we've had up to this point," emphasizes Credit Union National Association Board Chair Dennis Pierce during his general session speech Wednesday at CUNA's 2014 America's Credit Union Conference. (CUNA Photo)

Dennis Pierce, board chair of the Credit Union National Association, highlighted this achievement as he addressed his audience at CUNA's 2014 America's Credit Union Conference Wednesday to back up his belief that credit unions can continue to accomplish remarkable feats, now and into the future.

"If we're valid, if we have a purpose, and if we're providing something unique to Americans, I think credit unions have an opportunity to look back 80 years from now and celebrate similar kinds of success that we've had up to this point," said Pierce, who's also the CEO of CommunityAmerica CU, Lenexa, Kan., with $1.9 billion in assets.
 
In the chairman's speech, Pierce outlined specific numbers he believes the industry can conquer in the short term. By 2023, he believes credit unions can lock in 55 million primary financial institution members and expand member financial value to $20 billion.
 
One way to reach such goals, Pierce said, is to continue to aim for the vision the industry has developed: Americans choose credit unions as their best financial partner.
 
Credit unions also will have success if they continue to put together coordinated efforts such as the "Don't Tax My Credit Union" campaign, which helped the industry maintain its tax-exempt status earlier this year, Pierce added.
 
"We had one-and-a-half million contacts sent to Congress," Pierce said. "Those of you who have any awareness of what that number means to an elected official: That makes a difference. That's something they pay attention to.
 
"We continue to have record numbers of attendees at our Governmental Affairs Conference," Pierce added. "I think that's reflective of your work, your engagement, and understanding the importance of making sure that we not only protect what we have, but that we establish an opportunity for us to have a future."
 
Pierce also recognized the work CUNA continues to do on behalf of the credit union industry, specifically calling out Bill Hampel, interim president/CEO, for taking the helm during this transition period while the organization considers candidates to become the CEO.
 
"I think from his comments yesterday you can tell that our organization is in great hands, and we're not missing a beat in terms of where we're headed, in our focus and our ability to represent credit unions, and ultimately credit union members, and providing value back to them as part of what the association does," Pierce said.
 
Pierce also noted that the board is actively searching for a new CEO and believes by this fall, they will have selected the person to succeed Bill Cheney, who stepped down from his post as the head of the trade association in June.
 
"But ultimately, our target is to make sure that we find the right person," Pierce said. "This organization deserves leadership at a level that can take it where you need it to go, in terms of your needs as members of CUNA."
 
Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

NFCC pushes consumers to declare independence from debt

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WASHINGTON (7/3/14)--This July 4, the National Foundation for Credit Counseling (NFCC), in the spirit of Independence Day, challenges Americans to declare their own personal financial independence by making a commitment to become free from the bondage of debt.
 
"The stress of unmanageable debt has destroyed marriages, shattered families and contributed to lost jobs," said Gail Cunningham, NFCC spokesperson.  "No one ever scripts financial ruin as a part of their life plan, but when financial distress occurs, it is a very real part of a person's daily activities, as debt is a burden people carry with them 24 hours per day."
 
Aside from the personal problems associated with debt, NFCC offers consumers these reasons to take action and begin resolving their debt issues:
  • A blemished pay history reflecting late or missed payments tarnishes a person's credit report, which could result in a lower credit score;
  • A low credit score often results in a higher interest rate when borrowing money, making the cost of credit more expensive
  • A tarnished credit record could diminish access to additional credit needed for emergencies or unplanned expenses;
  • With an unrealistic amount of money earmarked for debt repayment, saving and investing are often neglected, and
  • Planning for future needs such as college or retirement is often delayed.
Consumers may mistakenly think they are responsibly managing debt by making the minimum payments due on time every month. They don't bother to calculate how long it will take them to become debt free, or how much they will have paid in interest. 
 
Consider: With a $10,000 credit card debt at 18% interest, even if no additional purchases or fees are added to the account, and the card holder makes monthly on-time payments of 2% of the balance, it will take 48 years to pay the balance. That original debt of $10,000 will cost $36,825, with $26,825 going toward interest.

Debit rewards program buys 13,000 meals for hunger relief

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ONTARIO, Calif. (7/3/14)--The California and Nevada Credit Union Leagues reported more than 13,000 meals have been donated through its card reward partnership with MOGL.
 
Thirteen credit unions with more than 87,000 member payment cards are enrolled in the program, and another five are in the queue ( In the News June 30).
 
Members receive 10% cash back every time they use a registered credit or debit card at one of MOGL's participating restaurants.
 
Diners can choose to donate some or all of their cashback reward to a local food bank.
 
And, for every dining transaction that is more than $20, a meal will be donated to a community food bank via Feeding America.
 
Because it is tied to a debit or credit card, the rewards program does not require coupons, punch cards or check-ins.
 
Including all of its partnerships, MOGL has donated 761,702 meals through its program.

Carefully consider nontraditional mortgages, Schenk tells Fox Biz

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NEW YORK (7/3/14)--Even with historically low interest rates, a traditional mortgage just won't work for some potential homeowners. In those cases, there are options, but ones that should be carefully considered, Credit Union National Association interim Chief Economist Mike Schenk told Fox Business Wednesday.
 
Consumers can look to borrowing funds from a family member or their own 401(k) or consider a lease-to-own type of contract.
 
Schenk advised borrowers to do their homework because "in some cases ... the transactions can be complicated and confusing."
 
Wannabe homeowners may be tempted to tap into a retirement account to cover a down payment, but Schenk said, that's "almost always a bad idea." Early withdrawal penalties and a less stable retirement situation could be the consequences.
 
Other experts suggested the debt averse could take out a loan against the principal of a life insurance policy or lease-to-own contract in which residents pay the owner each month. The ultimate option for those who don't want a mortgage loan is to save up and pay cash.
 
To read the full Fox Business article, use the resource link.

ACUC: Mobile is a strategy, CUNA Mutual's Israelite says

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SAN FRANCISCO (7/2/14)--Credit unions are beginning to realize the importance of mobile lending, but many haven't figured out how it fits into their strategic plans, a CUNA Mutual Group lending specialist told attendees of the Credit Union National Association's America's Credit Union Conference in San Francisco on Tuesday.
 
Before getting into mobile, a credit union should determine if their goals and strategy are related to mobile, advises Robert Israelite, CUNA Mutual Group lending and compliance specialist. Israelite spoke during one of the Discovery breakout sessions at Credit Union National Association's 2014 America's Credit Union Conference Tuesday. (CUNA Mutual Group Photo)
"A credit union has to go back to its vision, values and mission in determining its future in mobile. Mobile is a strategy," Robert Israelite, CUNA Mutual Group lending and compliance specialist said. "It has to start with why you are in business. Before getting into mobile, a credit union should determine if their goals and strategy are related to mobile. If there's no purpose to be on mobile, it's worthless because it has to be connected to a strategy."
 
Israelite said if a credit union's vision is to provide personalized, one-on-one, face-to-face consultative services to a segment-based group, they may determine they don't need mobile. "But, if a credit union wants to be a full-service provider to members in the member's delivery channel of choice, then the credit union needs to have a mobile-first mindset across their entire business," he added.
 
Many veteran CEOs have expressed disbelief that members are applying for loans on mobile devices, and boards are even further removed, Israelite said during his Discovery breakout session.
 
"Most credit union staff have never applied for a loan in a member channel, and that's a problem," Israelite said. "They have internal ways of doing it. Staff need to put themselves in the shoes of a 'real member' or potential member who doesn't have strong ties to the credit union."
 
Credit unions that decide mobile is essential to their business need to know and experience every online member-facing channel. Israelite urged attendees to "go through every link on your site, and if you don't control it, talk to business partners who do to get it optimized for mobile. You need to understand what your members are experiencing."
 
If a credit union determines mobile serves its mission and value, "you'd better get moving because you're already late to the party," Israelite added. He said credit unions late into the game have already lost more members than they'll ever know about. Those members, he added, have moved on, and they'll never come back.
 
"We lose a credit union every day with the merger pace continuing," he continued. "There is urgency if your credit union has determined it needs to adopt mobile but hasn't yet. You are setting up your legacy for your credit union to be around. If you miss this, you won't fulfill your legacy."

ACUC: Schenk highlights disconnect between economic reality, perceptions

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SAN FRANCISCO (7/2/14)--Perception is everything when it comes to gauging the health of the economy, and in Credit Union National Association interim Chief Economist Mike Schenk's perspective, while there's still a long way to go, the economy is currently trending up.

The job environment is one reason why "there remains a disconnect between overall consumer confidence and the day-to-day struggles consumers still face," Credit Union National Association Interim Chief Economist Mike Schenk notes during a Tuesday session on the economy at America's Credit Union Conference. (CUNA Photo)
Schenk walked a gallery of credit union professionals through his take on the state of the economy Tuesday at a special America's Credit Union Conference session called "Impact of the Economy: Credit Unions, Current Issues and What Lies Ahead."

While not all aspects of the economy have fully rebounded since the economic downturn in 2008, Schenk said there's enough evidence to believe the nation's financial health is finally improving.

"We think the economy has gotten better, and we think that it's going to get better yet," Schenk said.

Experts forecast a 3% expansion in the economy for the second quarter, pent-up demand continues to swell, labor markets have been healing and manufacturing has improved since the beginning of the downturn, among other bright spots, Schenk said.

But there seems to be a disconnect between what's actually happening in the economy, and how people perceive its health.

When Schenk asked those in the audience who felt the economy was improving to raise their hands, every single attendee did so.

Polls, however, say that the majority of U.S. citizens don't believe the economy is rebounding, Schenk explained, citing a study that found only 38% of people feel the economy is getting better, while 58% believe it's getting worse.

"That's a pretty powerful observation, I think the economy is getting better, you think the economy is getting better, but our members don't think it's getting better," Schenk said.

Part of the reason for this, is due to the tepid rate at which jobs have come back since the start of the recession. Further, there are concerns over the quality of the jobs that have been produced of late.  

"If you're looking for reasons why people may not be feeling that good, these are folks that are employed but they're not making a lot of money," Schenk said. "Jobs that don't take a lot of education but pay well and have good benefits, those jobs are going away, and that's a big deal."

The trend signals a growing belief that salaries are polarizing in the United States to high-paying jobs and low-paying jobs with middle-class individuals being squeezed out of the equation.

If income growth and quality jobs aren't produced, Schenk said, any further improvements to the economy will be anchored down.

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

La. gov. signs league-backed e-signature law

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HARAHAN, La. (7/2/14)--As of Tuesday, Louisiana financial institutions can accept electronic signatures after Gov. Bobby Jindal signed into law legislation that was drafted with the input of the Louisiana Credit Union League.
 
The original legislation, HB 661, was sponsored by Rep. Ed Price (D-Gonzales) to relieve credit unions of the burden of maintaining paper records. The practice of electronic document storage is widely accepted in the United States, however, Louisiana law previously restricted financial institutions reliance on electronic storage of certain records. 
 
The bill was drafted by the league, the law firms of Adams and Reese and Trimmier, Kudulis and Reisinger, with additional input from the Louisiana Bankers Association.
 
Among the new law's provisions:
  • Allows financial institutions to choose whether to rely on traditional paper records or digitally reproduced records;
  • Enhances confidence in digital record storage, retention and file integrity;
  • Decreases costs for financial institutions and consumers by eliminating the expense of retention of paper documents; and
  • Increases consumer confidence, protection and convenience by requiring that reproductions are certified by a representative of a financial institution.
Credit unions seeking to submit electronically signed records must attach a certificate of authenticity to the documents. The league has prepared a certificate for credit unions to use, which can be found on its website .

CU System briefs (07/02/2014)

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  •  
    Click for slide show Click for a slideshow of the Unite for Good Wall (CUNA Photo)
    SAN FRANCISCO (7/2/14)--The "Unite for Good" campaign, the Credit Union National Association's shared strategic vision in which Americans choose credit unions as their best financial partners, marked its first anniversary in February during CUNA's Governmental Affairs Conference in Washington, D.C.,  at the Walter E. Washington Convention Center. Building on the success of a Unite for Good storyboard at the GAC, where stories from nearly 100 credit unions were displayed throughout the convention center, CUNA is giving credit unions at this week's America's Credit Union Conference in San Francisco a fun opportunity to have their story told and illustrated. "You talk, Kate draws" asks credit unions to share their Unite for Good stories then instructs attendees to "Come back and visit your story when it is posted" for all to see. Click through the slideshow to get a sampling of what credit unions are most proud. Credit union advocates can also post messages to social media using the #UniteforGood hashtag ...
     
  • HARRISBURG, Pa. (7/2/14)-- As part of its commitment to community service, the Pennsylvania Credit Union Association is committed to the state's Adopt-a-Highway program and recently completed its second round of cleanup duties June 29 at the interchange of Route 22/322 and Linglestown Road ( Life is a Highway July 1). Participants included Joe Wambach, executive director, Pennsylvania Credit Union Association, left; T. Fetsko, controller/vice president of administration; Rhonda Rumbaugh, vice president of marketing and professional development; Corinne Sherman, senior vice president of fee services; Paula Walker, support services assistant; Rose Dietz, settlement representative; Mike Wishnow, senior vice president of communications and public relations; and John Kilduff, compliance administrator (Pennsylvania Credit Union Association photo) ...
  • RANCHO CUCAMONGA, Calif. (7/2/14)-- The young singer/songwriter Daria Musk will take part in a July 10 webinar that details CO-OP Financial Services' "Empowering People. Amplifying Dreams." campaign and offers new marketing materials. The free webinar-- "Empowering People. Amplifying Dreams: Building a National Brand of CO-OP Credit Unions" --will be 2-3 p.m. (ET). "The single greatest challenge to our movement's growth is consumers, especially young consumers, who don't understand what credit unions are, and aren't aware of the national access they provide," said CO-OP President/CEO Stan Hollen. The campaign aims to introduce consumers to credit unions and to the benefits of membership, while offering individual credit unions an opportunity to attract attention to their own brand, he added. Musk, the campaign's spokesperson, also will hold her second Google+ Hangout concert for CO-OP at 6 p.m. (ET) July 16 ...

Newest Mass. congressional rep. meets with CU delegates

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W
Massachusetts credit union leaders welcome the state's newest congressional representative during a Monday visit to RTN FCU, Waltham. James Regan, president/CEO, Digital FCU, Marlborough, left; Richard Wright, CEO/treasurer, RTN FCU; U.S. Rep. Katherine Clark (D-Melrose); Edward Lopes, CEO, Liberty Bay CU, Braintree; David Sprague, president/CEO, Hanscom FCU, Hanscom Air Force Base; and Doug Petersen, president/CEO, Workers' CU, Fitchburg. (Massachusetts Credit Union League photo)
ALTHAM, Mass. (7/2/14)--U.S. Rep. Katherine Clark (D-Melrose), the newest member of the Massachusetts congressional delegation, told a gathering of credit unions leaders Monday that she understands the credit union difference and is looking forward to working with them during her time in Congress.
 
Clark, who serves on the House Committee on Natural Resources, was elected in December in a special election to fill the seat previously held by now U.S. Sen. Ed Markey (D).
 
At the RTN FCU headquarters in Waltham, Mass., Clark met with officials from some of the 25 credit unions located in her district ( Daily CU Scan July 1).
 
Clark's experience at the state House and Senate included corporate income tax exemption, mandatory financial education in high schools and promoting state- and federally chartered credit unions as depositories for public funds.
 
She shared her belief that credit unions should not be lumped in with other financial service providers and praised them for their commitment to lending during the financial crisis.
 
Credit unions in attendance thanked Clark for signing on to the recent congressional letter to the National Credit Union Administration regarding its risk-based capital proposal.

ACUC: CUNA full-steam ahead, Hampel says

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SAN FRANCISCO (7/2/14)--No hiccups, no missteps, no lags. The Credit Union National Association is powering full-steam
Click to view larger image "CUNA is strong and in good shape," says CUNA interim President/CEO Bill Hampel at the ACUC. Hampel, who took the reins of the organization in June, tells ACUC goers, "Thanks to tireless efforts on your behalf, (we) intend the organization to be as strong as ever when a new CEO begins." (CUNA Photo)
ahead, proclaimed Bill Hampel, CUNA's interim president/CEO, as he addressed a packed house gathered for the second general session of CUNA's 2014 America's Credit Union Conference.
 
Hampel led off the session detailing the association's recent accomplishments, outlining the regulatory issues CUNA has and continues to tackle, and lauding the leagues and member credit unions for their dedicated work.
 
"CUNA is strong and in good shape," said Hampel, who took the reins of the organization in June when former President/CEO Bill Cheney stepped down to take over as CEO of SchoolsFirst FCU, Santa Ana, Calif., which has $10.3 billion in assets. "Thanks to tireless efforts on your behalf, (we) intend the organization to be as strong as ever when a new CEO begins."
 
At the outset of Hampel's address, the interim CEO recognized and thanked Cheney for what he achieved as CUNA's leader over the past four years. 
 
Cheney's greatest legacy, Hampel said, was creating a vision for the credit union movement--which he chalked out with the help of leagues and member credit unions throughout the country--that, one day, Americans will choose credit unions as their best financial partner.
 
And that's a vision Hampel vowed CUNA will maintain.
 
Meanwhile, with the credit union industry expected to earn its 100 millionth member later this year, Hampel described the various ways CUNA will capitalize on this opportunity to spark even more awareness of credit unions.
 
The plan includes the recent launch of a new website, www.americascreditunions.org, the distribution of materials to leagues and credit unions to pass out themselves, and events scheduled throughout the summer that will allow credit unions to highlight this significant achievement.
 
"100 million is a really big number, and reaching that 100 million memberships is a really big deal," Hampel said. "So we're going to make a really big splash about it."
 
Hampel also detailed the regulatory issues that CUNA, and the credit union industry as a whole, has been grappling with of late.
 
Of course, the National Credit Union Administration's risk-based capital proposal, which attendees learned about in great detail at another general session Tuesday, topped the list. (See related story:    )
 
"Working with leagues and credit unions, we all generated a record number of comments on a regulatory proposal: over 2,000," Hampel said. "More than 350 members of Congress have either signed onto a joint letter to NCUA or written their own, expressing their concerns about the proposal."
 
At the moment, the NCUA is hosting a series of Listening Sessions that will give credit unions, among others, the opportunity to voice their comments and concerns about the proposal, Hampel relayed.
 
Finally, Hampel teased next year's America's Credit Union Conference, which will take place in Denver, which sits only miles away from where CUNA was founded in Estes Park. 
 
He encouraged those who might attend to take the short drive, if they have the chance, next year to see the beautiful place.
 
"Our vision for the future brings us together with shared goals that would make the pioneers who met in Estes Park (80 years ago) really proud of what we have done, following on their initial work," Hampel said. ​

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

Changes are in the works for RBC proposal, Fazio says at ACUC

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SAN FRANCISCO (7/2/14)--The National Credit Union Administration will work as long as it takes to finalize practical regulations that govern asset risk at credit unions, Larry Fazio, NCUA director of the Office of Examination and Insurance, told a full house of credit union professionals Tuesday.
Click for slide show Larry Fazio, NCUA director of the Office of Examination and Insurance, tells a packed room of credit union professionals that the NCUA will use as long as it takes to get the controversial risk-based capital proposal right, adding that there is a lot of work yet to be done. (CUNA Photo)
The large crowd had come to listen to a panel discussion about the state of NCUA's controversial risk-based capital (RBC) proposal during a special general session at the Credit Union National Association's 2014 America's Credit Union Conference.

Answering a question about when the agency might finalize an RBC plan, posed during a Q&A with attendees that capped off the event, Fazio said, "There's a lot of work left to still be done." He added that the agency will spend "as long as it takes to get it right, and I don't know (how long) that will be because we're still in the re-engineering process."

Credit unions have been clear about their concerns over NCUA's RBC proposal, which would rewrite Prompt Corrective Action rules and replace the current system of risk-based net worth requirements with risk-weighted asset and capital requirements. The NCUA received a record number of comment letters before the comment period ended May 28.

A key problem, as CUNA's leaders have noted, is that the rule as proposed would force credit unions to build an incrementally larger buffer into their bottom lines to remain well-capitalized, a harsh penalty considering how responsible credit unions have been in their lending practices.

As CUNA Interim Chief Economist Mike Schenk illustrated during the RBC panel discussion, from the outset of the recession, only 25 credit unions failed as a result of taking on too much risk, while 450 banks of a similar size went under during that same stretch.

"On one level we had a real difficult time with why exactly this thing (proposal) was needed in the first place," Schenk said. "(Not only is this) a solution looking for a problem, but in our view it's a bad solution looking for a problem."

After its initial release, CUNA tested the proposal by running existing credit unions through the system, an exercise that produced several important and disturbing results, Schenk said.

Most notably, the rule led to very significant increases in capital requirements for thousands of credit unions throughout the United States, a dedication of resources which likely would impair their abilities to serve members.

"We have a problem with that," Schenk said.

Fazio acknowledged that the credit union system weathered the economic downturn well, but said the NCUA was tracking some credit unions who struggled with their assets, especially in those states hit hardest by the recession.

"I do think we have an opportunity to modernize our capital standards to bring them up to date, that's necessary," Fazio said, adding, "I think the trick, of course, is calculating it properly going forward--and certainly we want to get it right.

"A proposed rule is a place to start, it's not the end."

Reiterating comments made recently by NCUA Chair Debbie Matz, Fazio said all aspects of the proposal are still on the table for reconsideration.

"That doesn't mean we're going to make all the changes, but we're certainly going to take a fresh look at everything and continue to do research," Fazio said.

Mary Dunn, CUNA's deputy general counsel, also sat on the panel for the RBC session and outlined the specific recommendations CUNA has developed to improve the proposal.

The recommendations include lowering the risk-based capital component for well-capitalized credit unions, recalibrating risk-weights in a number of key asset areas, rethinking the definition of a complex credit union, and reconsidering a provision that would allow the NCUA to impose minimum capital requirements.

"We think this proposal is one of the most significant proposals credit unions are going to see perhaps in the next 10 years," Dunn said. "As a result of that, CUNA really wanted to pull out all the stops. We wanted to analyze this proposal as carefully as we possibly could."

Interim CUNA President/CEO Bill Hampel kicked off the session, laying out the significance of the RBC proposal, while General Counsel Eric Richard moderated, raising key questions for panelists to address. Senior VIce President of Legislative Affairs Ryan Donovan highlighted the significance of concerns raised by Congress and that NCUA has gotten out in front to support supplemental capital authority on Capitol Hill.

Be sure to visit  News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

 

Sinek tells CUs: 'Be the leader you wish you had'

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SAN FRANCISCO (7/2/14)--Positive leadership is like parenting, a keynote speaker told attendees at the America's Credit
Click to view larger image Leadership expert/author Simon Sinek challenges credit union executives to create a "circle of safety" to gain employees' trust and loyalty. True leaders, he says at the America's Credit Union Conference Tuesday, are those who put the needs of others before their own. (CUNA Photo)
Union Conference Tuesday. Leadership expert/author Simon Sinek challenged credit union executives to create a "circle of safety" to gain employees' trust and loyalty.
 
A title does not a leader make, Sinek quipped, adding that true leaders are those who put the needs of others before their own and willingly make sacrifices and take risks for the good of all.
 
Addressing the ACUC general session, Sinek said, "I know some people at the highest echelon who aren't leaders, and people at the lowest who are. It's all about looking out for others."
 
"The reward of leadership is to see others achieve more than you do," Sinek continued. "It's like being a parent."
 
As a parent would protect a child from danger, so must leaders shield employees from harm with what Sinek calls a "circle of safety."
 
When people feel safe, their natural disposition is toward cooperation and trust. When employees don't feel safe, they partake in nonproductive--even destructive--behavior.
 
"Leaders set the tone--they decide what environment you'll have," Sinek said. "If there's no circle of safety, people feel they have to protect themselves from each other. Anytime someone feels compelled to write a CYA email, this is a sign they don't feel safe from their own people--they're literally spending time to write an email to protect themselves as opposed to committing that time and energy to serve the organization."
 
"Our behavior is governed by our environment," he continued. "If there's a bad environment, people are capable of doing bad things. If it's good, they're capable of doing good things."
 
In a good work environment, the leader puts people before financial results in all but the most dire of circumstances. "A great leader would never sacrifice people to save the numbers," Sinek said. "A great leader would sacrifice the numbers to save the people. That's really important."
 
When the bottom line is prized above all else, people don't feel safe, they don't trust each other, and they know they're disposable. This is where credit unions have an advantage over their for-profit competitors, he said.
 
"Credit unions are human organizations," Sinek said. "This makes them empirically better than banks, which are all about the numbers. The credit union model has nothing to do with rates. It's a human enterprise, where you make sacrifices for the sake of employees and members. That's why I'm a credit union member."
 
Leadership takes daily practice, he added. "It's not an event, it's a 24-hour experience."
 
People can practice positive leadership every day by making others feel that they matter, Sinek said. "Be the leader you wish you had."

Sinek's speech also drew rave reviews on social media. Use the #ACUC hashtag on Twitter to listen in on the crowd's reaction, and visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco.

CUNA defense of rate risk among News Now's June Top 10

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MADISON, Wis. (7/2/14)--An article describing how a Wall Street Journal report on credit union interest-rate and credit risk missed several key points was the most-read News Now story in June.
 
Also, an article about a Credit Union National Association letter to the editor of the Wall Street Journal defending credit unions strong record of managing interest-rate risk was the third-most read article of the month.
 
The second-most read article was an interview with outgoing CUNA President/CEO Bill Cheney, who took over as president/CEO of  $10 billion-asset SchoolsFirst FCU, Santa Ana., Calif., in June.
 
The Top 10 articles for the month:
 
10. Lively back and forth defines RBC Listening Session

LOS ANGELES (6/27/14)--It was a lively back and forth at Thursday's National Credit Union Administration (NCUA) Listening Session here, with credit union participants enumerating their concerns with the regulator's risk-based capital (RBC) plan and the agency responding with thoughts about possible changes to the proposal.
 
9. CUNA: NCUA should respond to Hill RBC concerns with meaningful changes to proposal

ALEXANDRIA, Va. (6/2/14)--The NCUA responded Friday to 324 federal lawmakers who voiced concern about the agency's proposed risk-based capital plan. The bipartisan collection of House members joined Reps. Peter King (R-N.Y.) and Gregory Meeks (D-N.Y.) earlier this month to express their concern over the NCUA proposed rule and urged the federal agency to ensure the proposal does not adversely affect small businesses and credit union members.
 
8. NCUA state data shows loan, membership growth hot spots

ALEXANDRIA, Va. (6/6/14)--Idaho credit unions were at the top of many categories in the NCUA's state-level data from the first quarter of this year. The NCUA Quarterly U.S. Map Review is prepared by NCUA's Office of the Chief Economist and tracks performance indicators for federally insured credit unions in the 50 states and the District of Columbia.
 
7. Supreme Court mandates new look at ruling that allows MBS lawsuits

WASHINGTON (6/17/14)--The Supreme Court yesterday instructed the U.S. Court of Appeals for the 10th Circuit to re-examine a ruling that allowed the NCUA to sue several banks for alleged deceptive practices when selling mortgage-backed securities. This stems from a Supreme Court decision last week that defined in the environmental context the difference between statutes of limitation and statutes of repose, and whether various forms of "pausing" the period of time set forth by statute apply to statutes of repose.
 
6. First malware threats stalks mobile banking security

WOBURN, Mass. (6/17/14)--In what may be the first major security threat to mobile banking users, Kaspersky Lab discovered that a breed of malware targeting mobile devices had made its way from Russia to the United States.
 
5. NCUA reminds CUs to amend CUSO agreements

ALEXANDRIA, Va. (6/11/14)--Federally insured credit unions investing in or lending to a credit union service organization (CUSO) must amend the contractual agreement by the end of this month, in accordance with the new CUSO rule from the NCUA.
 
4. After record 2,052 comments, NCUA's next steps on RBC plan

ALEXANDRIA, Va. (6/12/14)--The NCUA's risk-based capital proposal received a record 2,052 comment letters by the May 28 deadline, surpassing the previous record of 1,300 received in 1995 on proposal that set all rules for federally insured corporate credit unions.
 
3. CUNA letter in WSJ: CU assets well managed, pose no undue risk

WASHINGTON (6/23/14)--In a letter to the editor of the Wall Street Journal , published Saturday, the Credit Union National Association defended credit unions strong record of managing interest rate risk.
 
2. Cheney reflects on tenure as CUNA CEO
WASHINGTON (6/10/14)--Today marks the last day that Bill Cheney will walk through the doors of 601 Pennsylvania Ave. NW as president/CEO of the Credit Union National Association.
 
1. CUNA: WSJ report takes unbalanced view of CU interest rate risk
WASHINGTON (6/9/14)--A Wall Street Journal story published Friday regarding credit union interest rate and credit risk misses some important points, according to Credit Union National Association analysis of credit union financials.

ACUC: Young CU professionals get executive treatment

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SAN FRANCISCO (7/2/14)--A group of young credit union professionals were treated to a nice surprise Tuesday on Day 2 of the Credit Union National Association's 2014 America's Credit Union Conference, when their Young Leaders Series session was combined with the larger Executive Series group.
 
Echoing several other young professionals at the table, Andrea Dickinson, Iowa Credit Union League member outreach coordinator, says it was a very valuable experience to sit it on the Executive Series session. (CUNA Photo)
The session, directed by Monday's keynoter and Extreme Leadership guru Steve Farber, unfolded into an open discussion among a roomful of top credit union leaders, which provided this green group a great deal of insight into the types of challenges the people they're striving to be in this industry face.
 
"It's a great experience to sit a table with CEOs, hearing the questions that were being asked today," Jen Laud, director of marketing and innovation at First Financial CU, Chicago, with $67 million in assets, told News Now . "It's really interesting because ... you see what's important to the people sitting in this room, what's at the top of their minds what's coming up for them."
 
Added Andrea Dickinson, Iowa Credit Union League member outreach coordinator: "To think about the longevity of our leaders in this industry is quite remarkable. To get to glean some of those insights is very valuable."
 
The leaders in the room fired off a volley of questions at Farber ranging from how to deal with the painful process of downsizing, to how to grapple with the roaring tides of changing technology, to how to stay positive at all times, but at the same time keep employees accountable.
 
The answers Farber returned likely provided useful information to the young credit union professionals about being a leader now and into the future, but even the questions themselves carried value.
 
"Everyone has questions, no one has all the answers," Joshua Smith, advocacy officer for SchoolsFirst FCU, Sana Ana, Calif., with $10.3 billion in assets, told News Now . "So it's not only reassuring, but it also gives you confidence to ask some questions."
 
Joshua Smith, advocacy officer for SchoolsFirst FCU, and the rest of the Young Leaders group listen intently as Steve Farber answers tough questions from credit union executives during an Executive Series session Tuesday at the America's Credit Union Conference. (CUNA photos)
Naturally, with a table full of young professionals sitting in on the conversation, the question was raised about how to engage, and eventually pass the torch to the younger generations.
 
Farber's answer was that current credit union leaders should actively seek out the young people in their organizations, share advice and insight and offer them opportunities in leadership roles as well, all with the hope that they will one day grow into individuals who are capable of running operations themselves, and perhaps become even more successful than those who taught them.
 
"(You should say) look at those folks, they are much better leaders than I was ever able to be," Farber said.
 
Hearing this issue debated was not lost on the group about which the executives were discussing. 
 
"When one of the questions is 'How do we incorporate this younger generation into the next movement of leaders, how do we make that happen?'" Laud said. "It's awesome to hear a question like that come up."
 
The session was the first of three Young Leaders Series sessions. The second one on Tuesday covered challenges and opportunities, and today's final meeting focuses on insights and engagement.

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

Mich. state CUs granted derivatives authority

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LANSING, Mich. (7/1/14)--The Michigan Department of Insurance and Financial Services (DIFS) has granted state-chartered credit unions the authority to purchase interest-rate derivatives to mitigate interest-rate portfolio risks.
 
DIFS Director Annette Flood signed Order No. 14-033-CU on June 23 to allow state-chartered credit unions the authority under the Michigan Credit Union Act (MCUA), the Michigan Credit Union League reported ( Monitor June 30).
 
The league, together with DFCU Financial CU, Dearborn, Mich., with $3.6 billion in assets, requested derivative authority based on the current provisions of the MCUA. DFCU and the league said that the use of derivatives is commonplace in the financial industry as part of sound risk-management practices.

Credit unions, like their banking counterparts, have interest-rate risk and are directed by their regulators to mitigate that risk. Appropriately used derivatives is a cost-effective means to mitigate that risk and a tool necessary to compete with other services providers, including federally chartered credit unions and banks.
 
Under the MCUA, the state director may issue an order authorizing domestic credit unions to exercise powers not specifically authorized if the director finds those powers appropriate and necessary to complete with other financial service providers in the state. Within the order, the director specifically found that:
  • Domestic credit unions may purchase interest-rate derivatives for the purpose of mitigating interest-rate portfolio risk in a safe and sound manner;
  • Sections 401 and 431 of the MCUA support authorizing such activity;
  • Competing federal credit unions operating under recently promulgated NCUA regulations already have the authority to engage in such purchases, thereby placing domestic credit unions at a competitive disadvantage if they are not permitted to use these derivatives;
  • There are no specific limitations on domestic credit union powers under the MCUA or other law that would prohibit authorizing these additional powers; and
  • Granting this additional authority is appropriate and necessary to enable domestic credit unions to compete with other providers of financial services.
State-chartered credit unions planning to purchase interest-rate derivatives to mitigate interest rate-risk must notify DIFS 60 days prior to the purchase, the order said.

One day without a phone? No way, says mobile report

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CHARLOTTE, N.C. (7/1/14)--Americans are attached to their smartphones--enough so that nearly half say they wouldn't last a day without their technological teddy bear. According to a Bank of America survey released Monday, smartphones rival only cars and deodorant as "can't live without" items.

And forget binge-watching "Orange is the New Black" while drinking a cup of joe: 76% of owners say their smartphones are significantly more important to them than TV, and 60% rated phones higher than coffee.

The inaugural Consumer Mobility Report looked at the banking behaviors of people who own smartphones and have a relationship with a financial institution.

The report also found that the youngest millennials age 18 to 24 are most likely to consider view their mobile phones as very important (96%)--more than deodorant at 90% or a toothbrush (93%) and even their toothbrush (93 percent).

As far as mobile banking goes, almost two-thirds have tried using mobile banking, most often for checking account balances, transferring funds and depositing checks remotely.

Even as interest in mobile services grows, the survey found 84% had visited a branch within the past six months. Visits were strong across age groups--83% of millennials and 85% of those age 35 and older.

America Saves: Consumers show more effort, more interest in saving

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WASHINGTON (7/1/14)--In the most recent Personal Savings Index from America Saves, consumers reported being more interested in saving and putting greater effort into doing so, resulting in more effective savings habits.
 
May's scores ticked back up to September levels after slumping in January. "The low savings interest, effort and effectiveness in January is probably related to holiday spending that served as a distraction and also made it difficult for many to save," said Stephen Brobeck, executive director, Consumer Federation of America.
 
The survey, taken every four months, measures consumers' interest in saving, the effort they make to save and how effective they are in meeting those goals.
 
"However, in each of the three periods, there was a consistent and predictable relationship between interest, effort and effectiveness.  Not all those with interest in saving make the effort, and not all those who make the effort are successful," Brobeck added.
 
As in the two earlier surveys, the savings gap was significant among income groups: those with less than $25,000 income annually were only 60% interested in saving, compared with 80% of those in the $100,000-plus income range. The difference continued in saving effort, 50% vs. 77%, and saving effectiveness, 43% vs. 74%.
 
"The lower one's income, the harder it is to save, and this difficulty appears to depress saving effort and even saving interest," Brobeck noted.

CU System briefs (07/01/2014)

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  • FORT LEONARD WOOD, Mo., and VANCOUVER, Wash. (7/1/14)-- Credit unions in Missouri and Washington recently held special events to support their local military service members . Mid Missouri CU, with $212 million in assets, hosted its ninth annual Military Appreciation Day at a Springfield (Mo.) Cardinals game June 14 ( Missouri Difference June 27). The Fort Leonard Wood-based credit union raised more than $20,000 prior to the event in order to purchase more than 2,000 tickets for active duty personnel, reservists, veterans, National Guard, retired military of all branches and their immediate family members. The credit union also gave away prizes and sponsored the evening's fireworks show. Maj. Gen. Leslie Smith administered the oath of enlistment for more than 40 U.S. Army enlistees who were sworn in before the game began (Missouri Credit Union Association photo). During Columbia CU's Heroes Night, about 1,500 people donated about $3,000 worth of items and $1,000 in cash. The $982 million-asset credit union, based in Vancouver, Wash., surprised attendees by buying gas cards or paying for memberships to Costco--the host business. The event's scavenger hunt gave attendees a chance to learn about community service organizations and win prizes ...
  • LEAVITTOWN, Pa. (7/1/14)-- Inspire FCU, an $87 million-asset credit union in Bristol, Pa., named Jim Merrill as its new president/CEO to succeed Glenn Styer , who is retiring July 31 ( Bucks County Courier Times June 30).  In the past 23 years, Merrill served as CEO of Fairless CU, Morrisville, Pa., with $47 million in assets, and executive vice president of the New Jersey Credit Union League. Most recently, Merrill was senior vice president at LendKey Technologies, a technology firm that is a CUNA Strategic Services alliance provider ...
  • TAMPA, Fla. (7/1/14)-- Arthur Wood III, who has been president/CEO for 17 years of Railroad and Industrial FCU, Tampa, Fla., will retire Oct. 1 .  During Wood's tenure, the credit union has more than doubled its assets, membership base and branch locations. Peter Giorgianni, who is currently vice president of operations for the $281 million-asset credit union, will succeed Wood Oct. 2. Giorgianni will be only the fourth CEO in the credit union's nearly 80-year history, said board Chairman Ben Davis ...

Cornerstone celebrates 1st year of consolidation

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FARMERS BRANCH, Texas (7/1/14)--One year ago today, the credit union leagues of Arkansas, Oklahoma, and Texas became one. Today, the Cornerstone Credit Union League is the largest credit union league in the country, serving 557 credit unions which in turn serve more than 9.5 million consumers.
 
Member credit unions have and will continue to benefit from this consolidation, said league CEO Dick Ensweiler.
 
Points of access provided by the Cornerstone Credit Union League in its first year include:
  • 130 professional development opportunities, including seminars, workshops, conferences, and webinars.
  • Asset-liability management services as a dues-supported service. These services included a semi-annual key ratio report and peer-group statistics, as well as monthly dividend and loan pricing guidelines. Cornerstone is the only league in the country offering these ALM services as a dues-supported service to credit unions.
  • Nine councils, including the CFO, Compliance, HR, Lending, Marketing and Business Development, Operations, Technology and Member Business Services councils. In the true spirit of collaboration, the league collaborated with the Louisiana Credit Union League in 2013 to offer the Member Business Services Council. Cornerstone added a Volunteers Council in 2014. Overall, council membership increased 20% in 2013.
  • Thirty-five credit union chapters, offering credit union professionals and volunteers opportunities to learn, network and share best practices.
  • Ideas and insight from Cornerstone's Young Professional Advisors. Cornerstone selected 12 young credit union professionals from across the region to serve in leadership roles, working to recruit and empower credit union professionals under the age of 35 to be engaged in the current and future successes of credit unions.
  • Financial education, professional development and disaster relief grants through its charitable arm--the Cornerstone Credit Union Foundation. In 2013, the foundation approved 301 grants totaling more than $384,000.
  • Services and solutions through its wholly owned subsidiary--Credit Union Resources, including human resources consulting and employment services, compliance, financial and auditing, technology consulting, strategic planning and shared branching. In 2013, CU Resources' signed partnerships with CO-OP Financial Services and INTECH, and in 2014 launched the only executive search program working inside the credit union system, recruiting and placing the next generation of leadership with credit unions.
"Consolidation has enabled us to harness the expertise and resources of each respective league. Our name may have changed, but our commitment to credit unions and the movement has not," said Ensweiler. "Drawing on the talents and experience of a diverse staff of 119, we are well positioned to respond to the needs of our member credit unions and deliver the outstanding products, services and resources they have grown accustomed to."
 
Tandie Lee Kenser, president, Garland County Educators FCU, Hot Springs, Ark., with $3.4 million in assets, said she believes the consolidation was necessary. "The Arkansas and Texas credit union leagues had already been collaborating in a number of areas including education and compliance, without the validity of true oneness,"  she said. "In my opinion as the leader of a small credit union, this change has been extremely positive. The quantity and quality of dues-based services have increased dramatically, the library of information is easily accessible, and the willingness of peers to work together is something I have never experienced before."
 
Sean Cahill, president/ CEO of Southwest 66 CU, Odessa, Texas, said he was initially concerned about the consolidation. "The Texas Credit Union League, to me, was the best league in the country, and I was worried that services may suffer with the consolidation," Cahill said.
 
 "But the absolute opposite has occurred," he added. "Cornerstone has taken things to a whole new level and I could not be more impressed.  The dues services are incredible, and the non-dues services provided through Credit Union Resources are world class. I use Cornerstone and Resources as much as I can because I know they have my best interests at heart. The leadership between both of these businesses lives and demonstrates the credit union motto every single day."
 
In hindsight, consolidation was the right decision, Cahill said. "The combined power of the three states collaborating together has brought new and exciting ideas to the table, as well as connecting the credit unions in these three states," he added. "I feel like my network has expanded as a result of the consolidation. And I do feel the league is in a better position to serve our needs, especially with regard to advocacy."
 
Cornerstone is headquartered in Dallas and maintains offices and a strong presence in the state capitols of Arkansas, Oklahoma, and Texas. Cornerstone also has a satellite office in Houston, Texas. Advocacy remains a critical area of focus for the league, so maintaining a presence in Austin, Little Rock, and Oklahoma City was a necessity, according to Cornerstone Paul Trylko, the league's board chairman.
 
"Being politically engaged is essential for the continued growth and prosperity of our movement," Trylko said. "It's important that lawmakers know that we are present, engaged and ready to defend and protect the rights of consumers who depend on credit unions to meet their financial needs."
 
Mike Kloiber, president/CEO, Tinker FCU, Oklahoma City, Okla., who was involved in the consolidation efforts from the beginning, feels it has exceeded expectations in the first year. "The feedback in Oklahoma is very positive, and the concerns held by many regarding the loss of identity and becoming lost in a bigger trade organization has proved unfounded by most everyone," Kloiber said.
 
While the consolidation has offered many benefits to member-credit unions, Kloiber highlights the following as the top three benefits:
  • Premium educational meetings, webinars and conferences provided by an impressive league infrastructure now available to all credit unions in Arkansas, Oklahoma and Texas;
  • A league staff of highly trained and experienced professionals willing to assist in every way possible; and
  • Network of communication through personal contact, technology and professional publications.

ACUC: CUs give 'Bite of Reality' to teach financial lessons

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SAN FRANCISCO (7/1/14)--While the consequences may have been fake, the financial decision-making lessons learned by students at the "Bite of Reality" money fair, held on Day 1 of the Credit Union National Association's 2014 America's Credit Union Conference (ACUC) here, were very real.
 
As a part of attending CUNA's America's Credit Union Conference, Maria LaVelle, CEO, Westmoreland FCU, Greensburg, Pa., volunteered for Monday's "Bite of Reality" financial simulation.
The event was held in conjunction with the conference as a way to continue a credit union tradition of giving back to a community that hosts a credit union event.  As explained by Amy Nigrelli, CUNA vice president of marketing and communications, CUNA and credit unions believe it is important to put together a give-back event like this.
 
"These people, these CUNA, league and credit union volunteers, could have gone on wine tours or other events throughout San Francisco, but they chose to come here and volunteer in this youth financial education effort," Nigrelli said. "It truly reflects the credit union philosophy of 'people helping people.'"
 
At the money fair, several dozen high school students from San Francisco were handed new identities--complete with jobs, salaries and family situations--and asked to make purchases on the essentials and not-so essentials based on their respective financial situations.
 
Volunteers--all credit union professionals attending the conference--ran the "stores," and as salespeople, they encouraged the students to buy lavishly, with the hope that at the end of their shopping sprees they would receive a little "Bite of Reality," and learn a tough but valuable lesson.
 
"You learn when you fail," said Tena Lozano, executive director of the Richard Myles Johnson Foundation, who spearheaded the event in collaboration with CUNA and the National Credit Union Foundation. "The best place to learn when you fail is when the money isn't real. Hopefully these lessons will sink in."
 
Desmond, a San Francisco high school student, was frugal when he made his purchases during Monday's "Bite of Reality" financial simulation at CUNA's America's Credit Union Conference. (CUNA photos)
When the students arrived, Lozano gave them a crash course on writing a check, which was their only form of payment, and then sent them off to buy cars, housing, groceries and clothing, among other goods.
 
Some splurged on boats, big houses and nice furniture, while others chose a thriftier route. "I didn't get the Ferrari," Desmond, a student participating in the event, told News Now . "Not in the budget."
 
After shopping, the students were instructed to visit the final booth, a mock credit union, where they would assess the damage and have the ability to sell back products they couldn't afford. Those who spent without regard received a dose of reality, while those like Desmond learned they might have the right idea in terms of managing finances.
 
"When it's your own money, can you afford that new iPhone?" posed Maria LaVelle, CEO, Westmoreland FCU, Greensburg, Pa., with $67 million in assets. LaVelle was one of the volunteers at the event. "I think it's about determining what a need is vs. what a want is."
 
Added Diana Kot, vice president of member development/advocacy, for SchoolsFirst FCU, Santa Ana, Calif., with $10.3 billion in assets:  "The results are amazing when you watch the kids, what they learn, the hands-on reality. The kids walk away with a much greater appreciation of what their parents have to do on a day-to-day basis; it's an eye opener for them."
 
But the students aren't the only ones who learned something Monday.  Volunteers, many of whom are involved in the credit union community, got a glimpse of the financial abilities of younger generations.
 
Judy Ensweiler, wife of Cornerstone Credit Union League CEO Dick Ensweiler, said she was surprised that so many kids didn't know how to write a check, taking that and many other "Ah ha!" moments away from the event.
 
Meanwhile, organizers of the event were pleased with the turnout, both by the students and by the credit union volunteers who participated.

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

ACUC: Farber spreads the love, a critical component of leadership

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SAN FRANCISCO (7/1/14)--In command of the room, with a booming-clear voice and confident posture, Steve Farber broached a subject that perhaps the packed house at the first general session of the Credit Union National Association's 2014 America's Credit Union Conference (ACUC) Monday wasn't expecting.
 
Love.
 
Along with three other principles--generating energy, inspiring audacity and providing proof--creating a culture of love, Farber said, is an absolutely integral component of running a successful business and being an effective leader.

 
Click for slide show San Mateo CU CEO Barry Jolette, a former chair of the Credit Union National Association, checks in Monday for the 2014 America's Credit Union Conference at the Hilton Hotel Union Square in San Francisco. (CUNA Photo)

Farber took it even a step further than that.
 
"To say that love has no place in business is just insane," he said. "It's probably one of the most powerful business principles we can tap into."
 

The first of four keynote speakers headlining this year's ACUC in San Francisco, Farber has built a reputation in the business industry as the "Extreme Leadership Guru," penning several books that have earned acclaim in business circles far and wide.
 
And in all his time researching and speaking about leadership, he told the crowd, within all of the most prosperous companies and organizations he has worked with, that four-letter word always finds its way into the reason for their success.
 
His proof? The words of a few the most accomplished business people in the world.
 
"(I'm) convinced the only thing that kept me going was that I loved what I did," Farber quoted the late Steve Jobs, who said this after being fired from Apple. "The only way to be truly satisfied is to do what you believe is great work, and the only way to do great work is to love what you do."
 
"I look into their eyes and try to figure out whether they love the money or if they love the business," read Farber's next slide, quoting Warren Buffett, famed billionaire investor. "If they don't love the business, I can't put my money into it."
 
Perhaps this discovery, that love is so inherent to the success of a business, is the reason why Farber's Extreme Leadership Institute has adopted the credo "Doing what you love in the service of people who love what you do."
 
Beyond meeting customer, or member satisfaction, which Farber describes as only a baseline accomplishment, getting members to love you and the services your organization provides is the key to really making an impact.
 
"(It's) serving them in a way that's so significant that what happens, the result that we get, the response that we get is that they love us back," Farber said. 

The following days of the conference bring many more interesting and enlightening events, including three more keynote speakers: Simon Sinek, who speaks today about leadership; Amber MacArthur, a digital media guru who will speak Wednesday; and Marcus Luttrell, who will tell a harrowing story Thursday of his time as a U.S. Navy Seal.

In addition to the speakers, the conference rolls on over the next few days with informational events such as the much anticipated risk-based capital session today, and discovery sessions such as "How to Create Killer Campaigns for Young Adults" and "Winning with Hispanics" tomorrow.  

Every day brings a vendor exhibit "Open Hall" and valuable time set aside for networking. 

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

Heard at ACUC: Come for the sights, stay for the networking

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SAN FRANCISCO (7/1/14)--For the 1,200 credit union professionals converging in San Francisco, there are countless reasons to attend the Credit Union National Association's 2014 America's Credit Union Conference (ACUC).
 
Some want to come up to speed on the latest technology, others want to pounce on unique opportunities to learn how to incorporate more financial education into their credit union's operations.  And this year they get to do that while taking in the bustling sights and sounds of a certain vibrant city by the bay, when there is time.
 
But there's one theme that seems to underlie all motivations for coming to ACUC, and that's for the chance to network and interact with credit union professionals from throughout the country. This incentive is especially high for small credit unions.
 
"Get out of your shops so you know what's going on, get (up to date) within the 21st century at least, and it's very important to network, very important," Linda Cappella, president/CEO of Credit Union ONE Inc., North Jackson, Ohio, with $10.8 million in assets, told News Now before Monday's small credit union roundtable.
 
"Small credit unions have a tendency to stay in their own little cocoon and their own little world and they operate like they always did, and that just isn't going to work anymore. It's not sufficient anymore."
 
Joni Senkpeil, director of small credit union development at the Illinois Credit Union League and the Credit Union Magazine CU Hero of the Year--honored Monday at the first general session of ACUC--could not agree more.
 
"It's really a networking opportunity, you learn so much from other credit unions, and if any industry can do it best, it's credit unions when you're talking about collaborating and that kind of thing," Senkpeil told News Now . "We've got to join together, join hands and we can do it easily. It's part of our foundation."
 
In truth, however, there are additional opportunities beyond networking to take advantage of at ACUC.
 
Brett Weber, who sits on the supervisory board of Allegiance CU, Oklahoma City, with $247 million in assets, for example, wants to increase his knowledge of the financial services industry in general, as his background is in IT.
 
Further, Weber is in search of ways to ramp up interest in credit unions by younger generations, which are noticeably missing at his credit union.
 
"We don't have as many volunteers of the younger generations to come up and help with supervisory committee, board of directors, volunteering and things like that," Weber told News Now . "I don't know if there could be some type of program to help gain interest for the Gen Xers out there that would want to volunteer for their credit union, something like that that would get new blood."
 
Weber plans to attend several of the young professional discovery sessions CUNA has planned for the week.
 
Cappella, meanwhile, is interested in learning about advances in technology that her credit union might be able to take advantage of.
 
"Technology is moving rapidly," Cappella said. "You blink and it's something new. Every day we're getting a new program, a new update and that's difficult, that is very difficult."
 
But in the end, no matter what each credit union professional takes away from the conference, they know they will leave with new relationships, which can be leveraged to improve credit unions nationwide.
 
"I gotta tell you it's the people sitting in the seats (here)...," Senkpeil told  News Now . "There's a lot of products and a lot of economies of scale that you can take advantage of in certain companies, and you have to look at that."

Be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow ACUC on Twitter using the handles and hashtag below:

Mergers don't stymie Wis. CU member growth

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MADISON, Wis. (7/1/14)--As with virtually every other state in the country, credit union mergers are changing the financial services landscape in Wisconsin, the Milwaukee Journal Sentinel reported in a June 29 article.
 
But regardless of the merger trend, credit unions aren't going anywhere. "We are seeing more people served, although by fewer credit unions," Brett Thompson, president/CEO of the Wisconsin Credit Union League, told the Milwaukee Journal Sentinel .
 
Two Wisconsin credit unions are set to merge this week, the latest in a wave of consolidation that has cut in half the number of credit unions in the state since the late 1990s, the Journal Sentinel reported. In the state's fifth merger of the year, Capital CU in Kimberly, with $480 million in assets, and Pioneer CU, Green Bay, with $604 million assets, will create Wisconsin's eighth credit union with more than $1 billion in assets.
 
The mergers are driven by a number of factors--increased regulations, the demand by consumers for costly technology such as mobile apps and the difficulty of finding people interested in running small credit unions as older leaders retire--the Journal Sentinel noted.
 
Since the recession, both credit unions and banks have been subject to creeping regulation. Smaller credit unions struggle the hardest to keep pace with the increased resources required to meet the demand of the new regulations.
 
"The regulatory and legal pressure on credit unions is as heavy as it's ever been," Thompson told the Journal Sentinel . "And to comply with all those regulations takes a great deal of staff time, a great deal of resources that many of our credit unions don't have."
 
At the same time, consumers demand the technology, such as mobile banking, that makes accessing their accounts convenient--requiring investments that only increase the financial strain for small credit unions.
 
The best way to provide those products is by merging with a larger credit union, Thompson said.
 
When the chief executives of the smaller credit unions retire, it can be difficult to find a replacement, said Mike Schenk, vice president and interim chief economist for the Credit Union National Association. Simply put, running a small credit union be a challenge, Schenk said.
 
"We do periodic salary surveys, and it's very clear these folks are working 60, 70, 80 hours a week, and the pay range is actually quite low in the scheme of things," Schenk told the Journal Sentinel . "Finding people who are willing to put in that labor of love, basically, is very, very difficult."

ACUC: Joni Senkpeil named CU Magazine's CU Hero of the Year

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SAN FRANCISCO (7/1/14)--In sheer numbers, small credit unions are big business, said Joni Senkpeil, director of small credit union development for the Illinois Credit Union League.
 
"They provide financial choice," she said. "We need them."
 
Credit Union Magazine  readers voted Senkpeil the 2014 Credit Union Hero of the Year. She received her award during Monday's opening general session at the Credit Union National Association's  America's Credit Union Conference. 
 
Keynoter Steve Farber also honored Senkpeil during his address. "A hero is someone who sees a need and steps up, like Joni," he said.
 
Senkpeil's passion for credit unions, especially small ones, is evident in her every activity. She started the league's Small Asset Size Credit Union Advisory Group, which aims to foster a stronger small credit union community.
 
She also launched a regional "lunch and learn" workshop series designed for small credit unions. The workshops are formatted strategically to minimize travel, time away from the office and hotel expenses for participants.
 
Believing credit unions needed a single source for resources, Senkpeil also was instrumental in developing content for the league's Small Credit Union Center website, including best practices, information on grant funding, strategic planning services, and common business templates.
 
Through her work, Senkpeil has given small credit unions a vital forum to network and help each other.
 
"Together we have a powerful voice, and we can do a lot," Senkpeil told her ACUC audience. She added there's not enough stories about how small credit unions work together. "Collaborate, and share your ideas with each other."
 
This honor has been "an amazing, awesome experience," she said, and thanked the credit unions she serves--her heroes--for inspiring her each day.
 
Credit Union Magazine  readers also honored these leaders as Credit Union Heroes:
  • William Armstrong, director, Northeast Community CU, Elizabethton, Tenn., with $99 million in assets;
  • Dan Morrisey, CEO/treasurer, Queen of Peace Arlington (Va.) FCU, with $2.1 million in assets; and
  • William "Bill" Rissel, president/CEO, Fort Knox FCU, Radcliff, Ky., with $1.1 billion in assets.
Use the resource link to go to Credit Union Magazine for more on the hero awards and to see more scenes from Monday at the ACUC. And for more on Farber's keynote speech on leadership, see related story: ACUC: Farber spreads the love, a critical component of leadership.

Also be sure to visit News Now and Credit Union Magazine frequently this week to keep up with all the ACUC action in San Francisco. You can also follow #ACUC on Twitter and by following NewsNowLiveWire .