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MBL featured in ISpectatorI IGazetteI over weekend

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WASHINGTON and CHARLESTON, W.Va. (9/14/10)--Credit unions' member business lending (MBL) was highlighted in different articles over the weekend, this time in the Charleston (W.Va.) Gazette and the American Spectator. In the Gazette, business owner Brad Nichols told about the $200,000 loan he got from Star USA FCU in Charleston, after visiting several banks (Sept. 10). Nichols said the credit union's loan, which financed the purchase of rental properties in Charleston and nearby Dunbar, offered a lower interest rate, better terms and no application fees. "With that money, I've been able to replace windows, doors, carpet and air-conditioners," Nichols told the newspaper. "I've also been able to hire a part-time maintenance person." However, Star USA FCU President Dan Smithson told the newspaper that if the credit union hits the 12.25% of assets cap on MBLs, "we literally have to stop making small business loans, even if we have the capital available. It's disturbing to us that we've had this cap placed on us. There's no real practical reason for it." The article addressed a measure before Congress that would raise the MBL cap for credit unions to 27.5% of assets from 12.25% . The Credit Union National Association (CUNA) provided statistics for the article, noting that West Virginia's small businesses would receive $34 million more in loans from credit unions and 370 jobs would be created in the state if the cap were raised. The second article, a pro-MBL special report Monday in American Spectator, was written by John Berlau and Andrew Kwiatkowski from the Competitive Enterprise Institute. The article discussed amendments before Congress that would lift the MBL cap and urged Republicans to "unite in support of a bipartisan but Reaganese amendment that would liberalize financial institutions to serve small business needs." It noted CUNA's estimate that the measure would create billions in new loans and more than 100,000 jobs in the first year. Congress will be taking up the issue this week and could vote by Thursday on the issue of raising the MBL cap from 12.25% of assets to 27.5%.

Texas league revises Juntos Avanzamos program

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FARMERS BRANCH, Texas (9/14/10)--EECU in Fort Worth, Texas, will be the first credit union to fly the Texas Credit Union League’s new Juntos Avanzamos flag. “Juntos Avanzamos” or “Together We Advance” is an outreach program of the league to serve the Hispanic marketplace. To be eligible, credits unions must complete an extensive and vigorous application process, said the league (LoneStar Leaguer Sept. 14). The $1.13 billion-asset EECU is the most recent Texas credit union to earn the designation. An official flag raising ceremony will be held at its north side branch located in a predominantly Hispanic neighborhood. The event will take place on International Credit Union Day, Oct. 21. “Access to affordable financial services is essential to building wealth, and credit unions are the right partner to help Hispanic families strengthen their financial well-being,” said Dick Ensweiler, league president/CEO. “EECU is to be commended for their efforts to narrow the gap which exists between our underserved communities and financial mainstream.” The league launched the program several years ago. It recently collaborated with Iowa-based Coopera Consulting to strengthen and expand the outreach program. The first order of business was to evaluate and improve upon the application process. Coopera already had created the Hispanic Opportunity Navigator, an assessment tool providing credit unions greater insight into serving the Hispanic population. After completing this assessment, a credit union will have the prioritized steps necessary to become the financial institution of choice serving Hispanics within its field of membership. The league also decided to give its Juntos Avanzamos logo a “facelift.” “As we worked to upgrade and refresh the Juntos Avanzamos program, we also decided it was time to update the logo representing the program,” said Gary Williams, president/CEO, Unity One CU, Fort Worth, who also serves as chair of the league's International Relationship Committee. He noted the new logo emphasizes family and unity. The league continues to work with Coopera to develop additional resources and collateral to enhance Juntos Avanzamos’ outreach efforts.

Voters go for candidates who back CU issues

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WASHINGTON (9/14/10)--An “overwhelmingly positive response” by voters in a poll indicates they would support a candidate who fights against banks and makes it possible for credit unions to provide loans to small businesses in their respective communities. The surveys are sponsored by the Credit Union National Association (CUNA) and conducted by research organizations Frederick Polls LLC of Arlington, Va., and Voter/Consumer Research of Washington, D.C. The surveys indicate that no less than three in five voters in separate polls of voters in eight congressional districts around the country said they would have a “positive reaction” to a candidate fighting against banking interests in support of more credit union business lending. Legislation pending in the House and Senate would raise the cap on credit union business lending to their members from 12.2% of assets to as much as 27.5%. The nation’s organized banking industry opposes the legislation. The polls were conducted Aug. 19-24, using identical questionnaires in selected congressional districts in Colorado, Kansas, Minnesota, Ohio, Oregon, South Dakota, Texas and Washington. The question was posed to 200 registered voters in each state, for a total of 1,600 interviews. The “positive reaction” ranged from a low of 62% (in Minnesota) to a high of 77% in Texas. The “negative reaction” ranged from a high of 15% (in Minnesota) to a low of 9% (in South Dakota). “The polling clearly shows that congressional incumbents and candidates will have warm support from voters if they take on the banks in support of more business lending by credit unions,” said CUNA President/CEO Bill Cheney. Cheney also pointed out that the recent polling matches findings of a national survey conducted early this year by the same firms. That survey asked voters if they would support legislation giving credit unions more business lending authority, in light of projections that it would inject $10 billion into the economy and create more than 100,000 new jobs. Voters in that poll strongly favored removing the cap on credit union business lending, with 69% in support and 25% opposed.

Schenk in IBaltimore SunI on student loan strategies

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BALTIMORE (9/14/10)--Mike Schenk, Credit Union National Association (CUNA) vice president of economics and statistics, was featured in The Baltimore Sun in an article about strategies to help students counter climbing student loan debt. Student debt reached nearly $830 million in June, exceeding credit card debt. Students should consider how much post-college income they will make when taking out loans, the Sun said (Sept. 12). Many students aren’t sure what career path to take, but they can use average starting salaries to get a ballpark figure, Schenk told the newspaper. Students can contact college placement offices to find out what jobs grads are finding and how much they pay. Or, they can look at the Bureau of Labor Statistics’ Occupational Outlook Handbook online for details about specific jobs, he added. Students’ expected starting salaries after graduation should be a factor in figuring out how much student debts to take on, but a survey last year by Sallie Mae indicated that 58% of families didn’t factor starting salaries in when they took out student loans. Also, the average debt for graduating seniors jumped to $23,200, a 24% increase in four years, according to the Project on Student Debt. The typical starting salary for 2010 graduates dropped to $48,288 from one year earlier, said the National Association of Colleges and Employers.

Kern Schools FCU to close fifth branch

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BAKERSFIELD, Calif. (9/14/10)--Kern Schools FCU, based in Bakersfield, Calif., announced Friday plans to close its Delano, Calif., branch Oct. 6--which would be its fifth branch closure. All but three of the Delano branch’s 15 employees have been placed elsewhere within the credit union, said Steve Renock, Kern Schools president/CEO (The Bakersfield Californian Sept. 4). The closure is anticipated to save the credit union $700,000 annually in facility costs alone, Renock told the newspaper. “In these tough times, you have to make very difficult choices,” he added. Kern Schools closed four of its branches and laid off 40 employees in March. In January, the $1.47 billion-asset credit union announced it lost $40 million in 2009 from borrowers who had difficulties paying their auto loans and mortgage payments as the recession intensified (News Now Feb 25). On Aug. 16, the credit union laid off seven employees in a cost-cutting move (News Now Aug. 24).

Former CUNA Chairman Christie Eugene dies

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NORFOLK, Va. (9/14/10)--Christie Eugene, a former director and chairman of the Credit Union National Association (CUNA) and long-time Virginia credit union movement leader, died Sunday after a long illness. He was 82. Eugene, who was a credit union advocate and volunteer for 61 years, served as CUNA chairman from 1991 to 1993 and as a CUNA director for 13 years. He spent three decades serving the Norfolk (Va.) Fire Department, beginning in 1948, and managing the Norfolk Fire Department FCU until 2002. After his retirement, he stayed on as treasurer of the credit union. He also held dozens of positions with the Tidewater Chapter of Credit Unions and the Virginia Credit Union League, including 20 years as director and two years as board chairman from 1983 to 1985 (News Now May 12, 2006). In 2006, Eugene received the Virginia Credit Union League's James P. Kirsch Lifetime Achievement Award. In 2009, he was inducted into the national Credit Union House of Leaders. "I'm proud of the good we do," Eugene said in 2006. "Sometimes that's giving a member a car loan or helping them put their children through college. Or sometimes it's something really special, like the member we helped out with a loan to travel to China to adopt a child. That little girl still looks at me like a grandfather; those are the things you really remember. Credit unions really are special, and I'm proud to say that I've got children and grandchildren who don't even know what a bank is; all they've ever known is their credit union." "Christie lived and breathed credit unions' 'People Helping People' philosophy," said Virginia league President Rick Pillow. "He was a true leader for both the state and national movements, a mentor to many of us, and one of those rare individuals you always enjoyed being around." Kathy Galland, CEO of Norfolk Fire Department FCU, noted that Eugene "taught me far more than any other person in my lifetime. "Christie really showed me that the members are what counts. Not what the regulators want, not following policies verbatim, just helping people achieve their financial goals. Together, we took the credit union from $13 million in assets to almost $30 million, realizing a personal goal of his to surpass $25 million in assets," Galland said, adding that "The membership cared deeply for Christie," and "he will be missed." Visitation will be Sept. 20 from 7 to 8 p.m. at Hollomon-Brown's Great Bridge Chapel & Chesapeake Memorial Gardens, located at 524 Cedar Road, Chesapeake, VA 23322. Funeral services are scheduled for Sept. 21 at 11 a.m. at Annunciation Cathedral Greek Orthodox Church, 7220 Granby St., Norfolk, VA 23505.

Michigan CUs grow in challenging economy

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LANSING, Mich. (9/14/10)--Michigan credit unions reported strong net worth, lending and membership growth in the second quarter, according to the Michigan Credit Union League. Data from the National Credit Union Administration shows Michigan credit unions received a 0.3% return on assets, which was stronger than expected, the league said. Credit unions had a net worth to assets ratio of 10.7%, greater than the national average of 9.9% or Michigan banks’ average of 9.2%. Ninety-four percent of Michigan credit unions are well-capitalized, the league added. Other statistics:
* Loans grew 1.2%, with used-auto loans increasing 10.3%, first mortgages 2.6% and credit cards 5.3%; * Commercial business loans grew 17.7% for the 12 months prior to June 30, compared with the national growth rate at credit unions of 7.7%. Commercial lending at Michigan banks dropped 5.7% through June and 13.9% nationally; * Real estate loans at credit unions during the second quarter grew 0.8%, compared with a decline of 13.3% at state banks and 6.8% at banks nationally; and * Savings grew by 7.5%, with money markets the fastest growing accounts up 20.7%.
“Michigan’s credit unions are a bright spot among financial institutions in the state, despite ongoing difficulties in our economy,” said David Adams, league president/CEO. “They are lending in their communities and supporting businesses and families.” About 44% of Michigan residents belong to a credit union. About 15,000 residents moved their money to credit unions since January, bringing membership to 4.4 million.

CU System briefs (09/13/2010)

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* LANSING, Mich. (9/14/10)--Michigan Gov. Jennifer Granholm, after
speaking at a Highland Park Business Association meeting on Aug. 31, visited Communicating Arts CU (CACU) and the Shops at Woodward Place, a development she and Wayne County Executive Robert Ficano supported through the Wayne County Land Bank TURBO program and Michigan Cities of Promise program. CACU was the second tenant to commit to the project (Michigan Monitor Sept. 6). From left are Shandell Small, CACU assistant loan manager; Ficano; Granholm; Kim Vermander, CACU vice president of lending and development; Hank Hubbard, CACU CEO; and Highland Park Mayor Huber Yopp. (Photo provided by the Michigan Credit Union League) ... * MONTGOMERY, Ala. (9/14/10)--MAX, Your Community CU will present "The
Reggie Barlow Show" at 10 a.m. on Saturdays on local cable networks. On the show, Alabama State University Head Football Coach Reggie Barlow will highlight the Hornets' previous week on the gridiron. He will bring his professional football experience with the Jacksonville Jaguars, Oakland Raiders and Tampa Bay Buccaneers, where he was a Super Bowl winner, and coaching expertise to the show. From left are CBS 8 Sports Director Dee Jackson, MAX CEO Greg McClellan; Barlow; and DG Markwell, MAX senior vice president of marketing and business development. (Photo provided by MAX, Your Community CU) ... * PORTLAND, Maine (9/14/10)--"People Remembering and Helping People" was the theme
for the eighth annual 9/11 tribute by Maine's credit unions to the five Red Cross Chapters of Maine. The ceremony honored victims of 9/11 and their families, and recognized organizations that work each day to protect the health and safety of people in Maine. Checks in the amount of $911 were presented to the Emergency Food Relief Fund of these American Red Cross chapters: Southern Maine, United Valley, Mid Coast, Pine Tree and Pine-Tree Aroostock chapters. Jon Paradise, center, governmental and public affairs manager for the Maine Credit Union League, holds a check with representatives of the Red Cross and food pantries. (Photo provided by the Maine Credit Union League) ...

Websites listing of CU as failure in error says CU

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NAPERVILLE, Ill. (9/14/10)--DuPage CU in Naperville, Ill., has succeeded in getting its name removed after being erroneously listed last month as a troubled bank on a “Troubled Banks” page on the website run by Bill Bartmann. The listing was based on an alleged $70,000 the credit union supposedly received in Troubled Asset Relief Program (TARP) funds (The Naperville Sun Aug. 25). However, now all is well, Bob Palumbo, CEO of the $261.5 million-asset credit union, told News Now. “The guy took credit unions off the listing after he realized credit unions didn’t receive TARP funds,” Palumbo said. “He said he had a part-time reporter who wanted to create some controversy. “[Bartmann] got all his information [in error] from the Federal Deposit Insurance Corp.,” Palumbo added. “Nothing came of it. Our members saw it and laughed.” Bartmann is a billionaire and CEO of Bartmann Enterprises, the paper said.