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Filed on August 31, 2009, published the first business day after.
- Joint liquidity rules redundant for CUs, says CUNA
- FinCEN offers guidance on new CTR exemption rule
- NCUA sets Town Hall meetings
- Free Choice members served now by Trumark Financial
- Inside Washington
- CU system leaders to gather at Estes Park
- Grassroots lobbying defines Mica's tenure, says league
- Wegner Award recipient Biz Kid$ wins Emmy
- Invest in America expands to RVs
- Missouri CUs’ Homes for Our Troops recipient named
- Data breach mastermind to plead guilty
- Tierney presented NASCUS’ Pierre Jay award
- California announces Maxwell, Herring award winners
- Minnesota award winners announced
- CNYIN names new board
- Cann to lead NASCUS CU Advisory Council
- MBL blog notes CUs' efforts to serve small biz
- CU System briefs
- Market News
- Economy's big driver still on sidelines, CUNA tells Reuters:
- News of the Competition
- Community CU conference set for October
- CUSN partners with CO-OP Financial Services
Joint liquidity rules redundant for CUs, says CUNA
WASHINGTON (9/1/09)—New joint federal regulatory guidance on funding and liquidity risk management makes sense at for banking organizations, but would only be redundant to existing rules for credit unions, the Credit Union National Association (CUNA) said in a comment letter submitted Monday.
The CUNA letter addresses proposed interagency guidance issued the National Credit Union Administration (NCUA), Office of the Comptroller of the Currency, Federal Reserve Board, Federal Deposit Insurance Corporation, and Office of Thrift Supervision. The proposed guidance is intended to clarify and summarize principles of sound liquidity risk management previously issued by the agencies.
CUNA adamantly supported "robust, ongoing liquidity risk management at all credit unions" in its letter, but delineated a number of reasons why the NCUA should not go forward with the proposed guidance. For instance, CUNA noted, sound liquidity risk management policies and processes already are well covered in the agency's Examiner's Guide, "Chapter 13- Part 3, ALM-Liquidity Risk."
All of the key components of the guidance are addressed sufficiently in the examination procedures, including adequate sources of liquidity, contingency planning in the event of liquidity problems, monitoring and reporting on liquidity," noted Mary Dunn, CUNA senior vice president and deputy general counsel, who signed the letter.
CUNA also wrote:
- The NCUA has not provided a sufficient rationale for new requirements that would be imposed on federal credit unions;
- The proposed guidance attempts to impose uniform liquidity risk management procedures on all financial institutions regardless of size or charter type, while CUNA believes that the proposed guidance is more appropriate for very large banks;
- Regarding corporate credit unions, the NCUA already is reviewing the structure of the corporate system and, CUNA pointed out, "any additional requirements for corporate credit unions in this area should be addressed in the context of that review."
The CUNA letter concluded that it is better for the agency not to go forward with the proposal, but added if NCUA feels it is necessary to address liquidity risk issues, it should develop a Letter to Credit Unions that focuses on specific problems and addresses steps credit unions can take to address them under the agency's current liquidity risk management requirements.
Use the resource link to read CUNA's complete comments.
FinCEN offers guidance on new CTR exemption rule
WASHINGTON (9/1/09)—Responding to a Government Accountability Office (GAO) recommendation for more guidance to help financial institutions determine whether a member or customer is eligible for exemption from currency transaction reporting requirements, the Financial Crimes Enforcement Network (FinCEN) Monday issued new Bank Secrecy Act direction.
The FinCEN guidance provides examples and answers to commonly asked questions regarding a final rule that went into effect on Jan. 5, and which made the following changes to the CTR exemption system:
- Elimination of designation and annual review for most Phase I customers;
- Financial institutions may now designate an otherwise eligible non-listed business customer/member for exemption if it has conducted five or more reportable transactions in currency within a year (previously, eight or more reportable transactions were required);
- The waiting time for Phase II eligibility was decreased from 12 months to two months or less than two months if a risk-based analysis of the member's transactions was conducted; and
- Biennial renewals for Phase II exemptions were eliminated.
FinCEN's new guidance includes an easy-to-read chart to help financial institutions establish when a member or customer can be exempt.
Use the resource link below to access more information.
NCUA sets Town Hall meetings
ALEXANDRIA, Va. (9/1/09)—Chairman Deborah Matz of the National Credit Union Administration (NCUA) announced three upcoming Town Hall meetings to discuss corporate credit union and other credit union issues.
The meeting schedule:
- Tuesday, Sept. 15, St. Louis, Mo.;
- Wednesday, Sept. 30, National Harbor, Md., which is in the Washington, D.C. area; and
- Monday, Oct. 5, San Diego, Ca.
In her announcement Matz said, "These Town Hall meetings will provide an invaluable and important venue to have genuine dialogue about a variety of critical issues.
"The dislocations experienced by the financial markets have had a significant effect on both corporate and natural person credit unions, and it is incumbent on NCUA and the industry to come together in a forward-looking and reasoned manner to find solutions.
" The ongoing corporate rulemaking is but one element of this process; I am hopeful that, working together, we can turn the broader challenges into a catalyst for changes that will set a course for an even brighter future for the credit union industry."
Use the resource links below to access registration.
Free Choice members served now by Trumark Financial
ALEXANDRIA, Va. (9/1/09)-- Trumark Financial Credit Union, a $1.080 billion-asset credit union in Trevose, Pa., will now serve the former members of Free Choice FCU of Feasterville, which was liquidated by the National Credit Union Administration (NCUA) Friday.
The NCUA said Free Choice was liquidated to protect member assets while addressing operational issues within the credit union because of a deteriorating financial condition.
With shares purchased and assumed by Trumark Financial, former Free Choice members are guaranteed full member-owner rights at TFCU, the NCUA noted in its announcement.
Prior to the purchase and assumption, Trumark Financial served 91,000 members in neighboring counties in southeastern Pennsylvania. Chartered in 1955, the liquidated Free Choice had assets of approximately $326,000, and served more than 400 members from 20 select groups.
Inside Washington
- ALEXANDRIA, Va. (9/1/09)—The National Credit Union Administration (NCUA) has sent out a follow-up communication to its fraud alert last week regarding a bogus Letter to Credit Unions that itself masqueraded as an NCUA fraud alert. The false alert, the NCUA said, appears to be confined to the activity of a single credit union. According to the agency, as part of an internal "system penetration" test, a credit union created a facsimile of an NCUA Fraud Alert. "This was an unauthorized and improper use of the NCUA logo, and also included a falsified signature of then-Chairman Michael Fryzel," NCUA said. The bogus alert was forwarded to the NCUA and that prompted the issuance of the Aug. 25 Fraud Alert. Credit unions are not authorized to create facsimile documents bearing NCUA logos or signatures, or to improperly represent communications from NCUA, even during the legitimate conduct of business such as a computer security assessment. The NCUA said it takes any type of security breach very seriously. "We also place a high priority on making federally insured credit unions aware of any illegal, fraudulent or deceptive activities that are frequently aimed at financial institutions. NCUA vigilance in this important area will continue, as will our efforts to make certain that credit unions take all proper precautions to protect sensitive member information and maintain financial security."...
- WASHINGTON (9/1/09)--Taxpayers should start to see profits as big banks repay their government bailout funds (The New York Times Aug. 31). Eight of the nation's largest banks have completely repaid their bailouts, amounting to about $4 billion in profits, the newspaper said. The government also earned profits of $1.4 billion from Goldman Sachs, $1.3 billion from Morgan Stanley and $414 million from American Express when they repaid their bailouts. Bank of New York Mellon, State Street, U.S. Bancorp, BB&T, and Northern Trust also helped bring profits ranging from $100 million to $334 million. The repayments represent a small portion of the government's financial rescue of banks and other companies, but taxpayers could collect more profits as banks repay their debts. When the bailout funds were issued, taxpayers were told they would make a modest return on the bailout funds. Critics had warned taxpayers, saying they may not reap any profits if some banks could take years to repay the money ...
- WASHINGTON (9/1/09)--The Federal Deposit Insurance Corp. (FDIC) has agreed to guarantee $80 billion in loans and other assets from more than 50 deals, or "loss shares," to encourage banks to buy up assets from their failed counterparts. The exposure is about six times the amount remaining in the FDIC Deposit Insurance Fund, according to The Wall Street Journal (Aug. 31). The government has shifted into cleanup mode from financial crisis mode, though its financial burden is not receding, the newspaper said. The FDIC has paid $300 billion so far to banks under loss-share agreements ...
- WASHINGTON (9/1/09)--The Federal Deposit Insurance Corp. (FDIC) said Friday that it is extending the "de novo" period for newly insured financial institutions to seven years from three years for exams, capital and other requirements. Typically, newly insured financial institutions are subject to higher capital requirements and more examinations during a de novo period. The FDIC also must approve material changes in business plans for the institutions during the first seven years of operation. The changes address the elevated risk that newly insured institutions pose to the FDIC Deposit Insurance Fund, the agency said ...
- WASHINGTON (9/1/09)--The Securities and Exchange Commission (SEC) has been historically slow in its oversight of credit-rating agencies, according to a report by SEC Inspector General David Kotz. In 1994, the SEC began issuing concept releases, conducting exams, issuing reports, conducting hearings and proposing regulations. However, it didn't adopt any regulations regarding nationally recognized statistical rating organizations. There also are certain instances of non-compliance with requirements of the Rating Agency Act, the report said. However, Kotz stated that the SEC has identified improving the quality of credit ratings as a priority ...
CU system leaders to gather at Estes Park
WASHINGTON (9/1/09)--Credit union system leaders past and present will gather Sept. 14-17 in Estes Park, Colo., to commemorate the 75th anniversary of the Credit Union National Association (CUNA).
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| Among the guests will be Kathy Pellitier, granddaughter of credit union pioneer Roy F. Bergengren. She is shown here speaking at an event at America's Credit Union Conference and Expo in June. (Photos provided by CUNA) |
Estes Park is where CUNA's Constitution and Bylaws were signed on Aug. 10, 1934, less than two months after the Federal Credit Union Act was signed into law and 25 years after the nation's first credit union was established.
"Seventy-five years ago, an extraordinary group of credit union pioneers held a 'meeting of the minds' in Estes Park, Colo., about a national association that would enhance the movement throughout the land and help it become self-reliant," said CUNA President/CEO Dan Mica.
"Today, it is an honor for all of us at CUNA to continue the work set out by those leaders three-quarters of a century ago," Mica added. "Our focus, like that of our founders, is on advancing this great movement to new heights through leadership, advocacy and services."
Among the highlights at this month's meeting will be special guest Kathy Pelletier of Berlin, Vt., granddaughter of credit union pioneer Roy F. Bergengren, who attended the meeting and helped found CUNA.
Activities scheduled include:
- A CUNA and CUNA Strategic Services board of directors commemorative meeting;
- Dedication of a 75th anniversary plaque at the YMCA Camp in Estes Park, where the original gathering of CUNA's founders took place;
- Keynote speeches from today's credit union leaders; and
- A photo at the outdoor site where 52 credit union delegates from 21 states and the District of Columbia originally posed for the iconic group photo taken in 1934.
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| Pioneers of the credit union movement gathered in 1934 for a group photo commemorating the founding of the Credit Union National Association (CUNA) at Estes Park, Colo. A similar photo is planned for the CUNA 75th anniversary gathering Sept. 14-17 in Estes Park.
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Among those invited to join the CUNA and CSS boards and executive management teams for the commemorative events are the credit union league presidents and their chairs from the 50 states, past CUNA chairs and CUNA presidents; representatives of affiliated and guest organizations, and board members of the National Credit Union Administration.
Today CUNA represents nearly 90% of the nation's 8,000 state and federally chartered credit unions, which have combined assets of close to $900 billion and serve more than 92 million Americans.
"When we meet in Estes Park as a tribute to our organization's founders, all of us will have 75 years of credit union progress on our minds--and a determination to ensure the next 75 years of progress and prosperity for credit unions," Mica said.
Grassroots lobbying defines Mica's tenure, says league
HIGHTSTOWN, N.J. (9/1/09)--Credit Union National Association President/CEO Dan Mica's announcement that he will step down from the position in January 2011 prompted one league CEO to sum up Mica's contributions to the credit union movement in two words: "grassroots lobbying."
Mica "brought so much to our movement and forever changed the way the credit union system looks," said Paul Gentile, president/CEO of the New Jersey Credit Union League, in his message in the league's newsletter (The Weekly Exchange Aug. 24).. Before he joined the league, Gentile spent a number of years as editor-in-chief of Credit Union Times, reporting on the industry and its trends.
In 1996, when Mica joined CUNA, "The credit union/bank war was fierce," wrote Gentile, outlining field of membership (FOM) expansion lawsuits brought by bankers against the National Credit Union Administration (NCUA), the AT&T FCU case appealed to the Supreme Court, FOM cases in Utah and Pennsylvania and "an onslaught of banker attempts to rid credit unions of their nonprofit status.
"Bankers routinely categorized NCUA as a 'cheerleader' for credit unions and not a regulator. The rhetoric was downright vicious. Vitriol spewed from bankers looking to squash expansion of the credit union movement. Credit unions were constantly on the defensive, always having to fend off one banker attack after another," he wrote.
"Enter Mica. At a time when credit unions' influence on Capitol Hill was modest, Mica raised the bar," said Gentile, noting that the CUNA Political Action Committee (PAC) has become one of the top trade association PACs in the country.
"But I believe Mica's greatest accomplishment was in grassroots lobbying and getting credit unions to understand that lobbying isn't just for crises. He had a vision to rally credit unions for the next attack, even when there was no attack," Gentile wrote.
"Mica led the development of authentic grassroots lobbying that hinged on building relationships from the roots of the movement, the credit unions themselves," Gentile said. "Any industry can bring in hired guns to represent them on Capitol Hill, but not just any industry has the type of grassroots power that Mica shaped during his 13-year tenure at CUNA," he added.
"Credit unions now understand the importance of constantly developing lawmaker relationships even when there isn't a rallying cry. Mica helped lead this sea of change in credit union lobbying. In the end, while our trade associations carry the ball on Capitol Hill, we need the participation of credit unions from throughout the country to really hit home with Congress. We have that today and Dan was the driving force."
Mica built a political machine at CUNA that has the structure to influence for years to come, Gentile said, listing CUNA's annual Governmental Affairs Conference and CUNA's Calls to Action, which rally thousands of credit union leaders to get the attention of lawmakers or regulators.
"We saw the power of that Call to Action earlier this year when CUNA pressured NCUA to give credit unions more information about the investments held in the corporate credit union network," he wrote.
Mica "turned CUNA from a marginal player in D.C. to a respected and sophisticated force. He put us on the map."
Gentile noted that the average tenure for a CUNA CEO was seven years. "Mica blew that mark away because of his passion for credit unions and his ability to get us organized in D.C. Make no mistake. Mica's mark on credit unions won't leave when he leaves."
Wegner Award recipient Biz Kid$ wins Emmy
SEATTLE (9/1/09)--Biz Kid$--the first national television program ever sponsored by America's credit unions--will be presented the National Credit Union Foundation's (NCUF) 2010 Wegner Award for Outstanding Program. And it won its first Emmy award this weekend.
The show was awarded a Daytime Emmy from the National Academy of Television Arts & Science on Sunday. The award was for "Outstanding Achievement in Main Title and Graphic Design." The program was nominated in two categories.
"First BizKid$ was nominated for the highest national honors in the television industry. Now it will win the highest national honors in the credit union movement," said Missouri Corporate CU President/CEO Dennis DeGroodt, who chaired NCUF's Awards and Recognition Committee during deliberations on Outstanding Program nominations.
The Wegner Award will be one of four presented at NCUF's 22nd Annual Wegner Awards Dinner on Feb. 22, 2010. The dinner will take place at Grand Hyatt Washington during the Credit Union National Association's 2010 Governmental Affairs Conference. Online registration will be available later this year at NCUF's website.
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| Pictured are members of the cast of the credit-union sponsored public television show, Biz Kid$, which won the 2010 Wegner Award for Outstanding Program, and an Emmy. (Photo provided by the National Credit Union Foundation) |
Executive Producer Jamie Hammond noted that the Emmy award is an "affirmation of the show's quality" and "a recognition of the importance of the subject matter, given that everything that is happening in our country at this time."
Washington Credit Union League President/CEO John Annaloro said the program is "the credit unions' gift to youth financial literacy in America." An Emmy "shows the power and innovativeness of the presentation," he added. "This award is a testament to the technical quality of the production, which draws viewers to the show and its lessons about financial literacy. As the exclusive underwriters of the first three seasons of the series, credit unions could not be happier."
In addition to the Wegner Award and the Emmy, Biz Kid$ was also nominated as an Outstanding Children's Television by the Environmental Media Awards for its episode on the green economy.
The program airs on 334 public broadcast stations, nationwide. The stations broadcast to more than 112 million households, including more than 230 million people over the age of two. That is 97% of the public television market and exceeds all American Public Television children's programs by 30%.
Each episode begins and ends with a student pulling down a projection screen over a classroom billboard to reveal the America's Credit Unions logo. A narrator reminds viewers that "Production funding for Biz Kid$ is provided by America's Credit Unions, where people are worth more than money."
Every episode includes four stories from successful young entrepreneurs reinforcing the importance of budgeting, saving and giving back to their community. Several of the featured youth have joined credit unions.
All 39 episodes come with lesson plans, teaching materials and activities that meet national financial literacy standards. Its curriculum was developed by a credit union advisory group and Outreach Extensions, creator of the educational materials for Bill Nye the Science Guy. In the past year, more than 64,000 teachers used the Biz Kid$ curriculum to educate 9.2 million students.
Invest in America expands to RVs
LIVONIA, Mich. (9/1/09)--The Invest in America program has been expanded to include seven recreational vehicle (RV) brands, announced CUcorp and RV manufacturer Thor Industries Wednesday.
Credit union discounts will range from $300 to $1,000 depending on whether the RV is motorized or towable. The discounts will be available nationwide.
Participating Thor brands include: Airstream, Breckenridge, CrossRoads, Damon Motor Coach, Dutchmen, Four Winds and Komfort.
"The agreement with Thor will provide value for credit union members on RV purchases, help credit unions gain more market share in RV loans and help strengthen the RV manufacturing industry through ‘Invest in America' program discounts," said David Adams, CUcorp CEO. CUCorp is a marketing company based in Livonia, Mich., and wholly owned subsidiary of the Michigan Credit Union League.
More people are staying close to home for vacations and looking to RVs as a more affordable vacation alternative, added Dicky Riegel, Thor chief operating officer.
Invest in America offers credit union members discounts on select domestic auto brands, including General Motors and Chrysler. Ford is offering a pilot leasing program in six markets. Discounts also are available through mobile phone carrier Sprint.
GM and Chrysler discounts through Invest in America have facilitated 180,000 vehicle sales since January with 146,000 credit union loans totaling $2.9 billion.
Invest in America has garnered significant media attention on its partnership with Thor from media outlets including CNBC, MSN Money, Forbes, The Wall Street Journal, BusinessWeek, Yahoo Finance, AOL Money, The New York Daily News, the Street, the Washington Examiner and the San Francisco Examiner. A number of RV and trade media also covered the partnership.
Missouri CUs’ Homes for Our Troops recipient named
ST. LOUIS (9/1/09)--Army Staff Sgt. Robert Canine, a native of Mexico, Mo., will receive the first specially adapted home built by Missouri credit unions and Homes for Our Troops (HFOT).
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| Army Staff Sgt. Robert Canine, a native of Mexico, Mo., standing on his new prosthetics, will receive the first specially adapted home built by Missouri credit unions and Homes for Our Troops. |
Canine lost both legs below the knee in an explosion when the Humvee he was commanding was attacked in Baghdad, Iraq, on May 17. He is undergoing a year of physical therapy at Walter Reed Army Medical Center and learning to walk again on prosthetics.
Canine, with his wife, Jennifer, and their eight-year-old son, Sebastian, will then return home to Missouri. Having a specially adapted house to come home to will make a tremendous difference to the family, he said.
"I have stayed in homes that are not handicap accessible, and it was a challenge every day to get around," Canine said. "The assistance I will receive from Homes for Our Troops will eliminate those daily challenges and improve my quality of living every day."
The non-profit group HFOT builds specially adapted homes for severely injured veterans, at no cost to the veteran. The Missouri Credit Union Association has joined forces with HFOT to build homes in the state.
"Credit unions' purpose is to help people and make a difference," said Missouri Credit Union Association President/CEO Rosie Holub. "We are thrilled to lead the effort in Missouri to build homes for injured veterans that will allow them to focus their attention on recovery and living their lives to the fullest here at home."
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| Robert Canine (center) and his son, Sebastian, and wife, Jennifer, are long-time members of United CU, Mexico, Mo. (Photos provided by the Missouri Credit Union Association) |
Canine and his extended family are long-time members of United CU, Mexico, Mo. He found out about the HFOT program from credit union staff shortly after he was injured.
"After Bobby was hurt, I thought about Homes for Our Troops and how it could really help them," said United CU Marketing Manager Heather DeMint. "I explained the program to his family in Mexico to see if they were interested and provided the information he needed to apply."
"We are proud to have Missouri credit unions join us in fulfilling our mission of building specially adapted homes for severely injured veterans," said John Gonsalves, HFOT president and founder.
Credit unions, leagues and the Credit Union National Association also partnered with HFOT and the national presidential conventions in Minnesota and Colorado for similar home projects in those states.
Data breach mastermind to plead guilty
BOSTON (9/1/09)--The man accused of masterminding the Heartland Payment Systems, Hannaford Bros. and TJX Cos. data breaches agreed Monday to plead guilty to 19 counts of conspiracy, wire fraud and aggravated identity theft charges in the breaches of TJX Cos. and other retailers in 2005.
Albert Gonzalez, 28, of Miami, Fla., will face 15 to 25 years in prison and forfeit more than $2.8 million in cash in the plea bargain with prosecutors in Boston (Bankinfosecurity and Computerworld Aug. 28). He will also forfeit a Miami condo, a car and jewelry. He was accused of stealing 170 million credit and debit cards in a number of breaches.
The plea bargain affects charges related to TJX, Barnes and Noble and Office Max braches. The deal also includes a case in New York, where he was charged with the breach of Dave & Buster's restaurants.
Data breaches against Hannaford Bros., Heartland Payment Systems, 7-Eleven stores, J.C. Penney and Target will be treated in a separate case in New Jersey. Gonzalez and two unnamed individuals were indicted in those cases in August.
According to The Boston Globe, the data thefts have cost New England companies several hundred million dollars in contending with the damages wrought by the data breaches. TJX said it spent $132 million on expenses related to the breach and set aside another $39 million to handle further claims. B.J. Wholesale Club set aside $13 million between 2004 and 2007 to handle fraud claims related to its breach.
Hundreds of credit unions had to replace cards compromised in the breaches and many suffered fraudulent withdrawals on accounts.
Tierney presented NASCUS’ Pierre Jay award
BOSTON (9/1/09)--Catherine Tierney, Community First CU 
president/CEO, was awarded the National Association of State Credit Union Supervisors (NASCUS) 2009 Pierre Jay Award at the NASCUS State System Summit, Aug. 20-22 in Boston.
The award is given to individuals who demonstrate outstanding service, leadership, achievement and efforts which benefit NASCUS and the dual-chartering system. The award was established to honor the memory of Pierre Jay, Massachusetts Banking Commissioner from 1906-1909 and the father of the first State Credit Union Act.
Tierney, a 30-year veteran of the credit union system, has been active in NASCUS and other credit union organizations for years. In addition to her credit union's recent success in challenging the Internal Revenue Service on unrelated business income tax, her Appleton, Wis.-based credit union reached $1 billion in assets--30 years after she started as a teller in the same credit union.
Tierney serves as the NASCUS Credit Union Executive Council secretary and as a member of the Education and Legislative and Regulatory Affairs committees.
"During Cathie's significant career in credit unions, there has never been a hesitation to contribute where needed, reaffirm the cooperative principles of the credit union system and most importantly, represent the state credit union system on the national and state levels," said NASCUS Past Chairman George Reynolds of Georgia, who presented the award.
"I can't think of an individual more deserving of this award," he added. "She has worked tirelessly to preserve and advance the dual-chartering system and to fight for the interests of all state-chartered credit unions."
California announces Maxwell, Herring award winners
RANCHO CUCAMONGA, Calif. (9/1/09)--Meriwest CU, San Jose, won first-place California state awards in the Dora Maxwell Social Responsibility Recognition Award and in the Louise Herring for Philosophy in Action Award program.
Also, L.A. Financial CU, Pasadena; TUCOEMAS FCU, Visalia, and the San Francisco Chapter won first-place statewide honors in the annual Dora Maxwell program.
Meriwest was recognized in the $500 million and above asset category for its "Financial Education for All" program. The credit union provided more than 115 various financial education classes to more than 1,650 community members.
Its first place Louise Herring Award was in the greater than $250 million asset category for its "Financial Education for All" program geared toward young members. So far this year, the credit union educated 225 members at its in-house workshops--124 in its Teen Real World Budget workshops, and 102 in its Credit Myths and Auto Financing 101 workshops.
The Credit Union of Southern California in Whittier, won second place in the $500 million and above asset category in the Dora Maxwell Award program for its annual food distribution program, which distributed more than 100,000 pounds of food to local residents in 2009.
California Coast CU, San Diego, won second place in the Louise Herring Award program in the greater than $250 million asset category for its Member Loan Assistance program to help those with financial hardships and difficulties making their mortgage, secured loan or unsecured loan payments.
L.A. Financial CU won a first-place Dora Maxwell award in the $200 to $500 million asset category for its partnership with the L.A. Clippers basketball team and its Kids Read to Achieve for Financial Literacy program. The program teaches youth about money by rewarding them for reading books about saving, budgeting and financial fitness.
This year, the credit union reached 16,300 students, with 83 high school students participating in a financial literacy essay program for a chance to win one of five $200 scholarships.
TUCOEMAS FCU received a first-place Dora Maxwell award in the $100 to $200 million asset category for its Hats for Hope program. The credit union donated 585 handmade knitted hats and 31 lap blankets to cancer patients undergoing chemotherapy and radiation treatments.
The San Francisco Chapter won its first-place Dora Maxwell award in the chapter/multiple credit union category for its first "Credit Union Night with the Golden State Warriors" program. The event raised more than $2,000 for the Children's Miracle Network and Children's Hospital and Research Center, Oakland.
The Golden 1 CU, Sacramento, received the only honorable mention given this year--in the greater than $250 million asset category in the Louise Herring Award program--for its youth programs.
Minnesota award winners announced
ST. PAUL, Minn. (9/1/09)--The Minnesota Credit Union Network (MnCUN) announced the state winners of the 2009 Dora Maxwell, Louise Herring and Desjardins awards.
The awards are sponsored by MnCUN and the Credit Union National Association.
Dora Maxwell Social Responsibility Awards winners include:
- West Financial CU, Medina; $5 million to $20 million in assets;
- Heartland CU, St. Paul, $50 million to $100 million;
- Greater Minnesota CU, Mora, $100 million to $200 million;
- Mid-Minnesota FCU, Baxter, $200 million to $500 million; and
- Hiway FCU, St. Paul, more than $500 million.
Louise Herring Award for Philosophy in Action winners are:
- Star Choice CU, Minneapolis, less than $50 million in assets;
- First Alliance CU, Rochester, $50 million to $250 million; and
- US FCU, Burnsville, more than $250 million.
Desjardins Youth Financial Education Award winners are:
- Greater Minnesota CU, $75 million to $250 million in assets; and
- TopLine FCU, Maple Grove, more than $250 million.
CNYIN names new board
RANCHO CUCAMONGA, Calif. (9/1/09)--The California and Nevada Youth Involvement Network (CNYIN) recently elected three new board members and re-elected one for 2009-2010.
The three new board members are:
- Shelly Berryman, SchoolsFirst FCU, Santa Ana, Calif.;
- Crystal Lyon, Silver State Schools CU, Las Vegas; and
- Dhara Sanchez of Inland Empire CU in Pomona, Calif.
Chairman Michael D. Lee of The Golden 1 CU, Sacramento, was re-elected to the board. All ran unopposed.
They join current board members:
- Mike Jones, Educational Employees CU, Fresno, Calif.;
- Michelle Lawrence, American First CU, La Habra, Calif.;
- Marlene Myers, Travis CU, Vacaville, Calif.; and
- Katherine "Kate" Robinson, Greater Nevada Credit Union, Reno, Nev.
"The new board has plenty on its plate for the rest of 2009, including a September 16 webinar on private student lending," said Cathy Arra, CNYIN liaison and California and Nevada Credit Union Leagues' credit union growth manager.
The webinar will be held from 1:30 p.m. to 3 p.m. with guest speaker Michael Weber of Credit Union Student Choice, a private student lending program.
CNYIN will host a National Endowment for Financial Education's High School Financial Planning Program Train the Trainer event at Redwood CU in Santa Rosa, Calif., Sept. 29.
It also will host the Credit Union National Association's Mad City Money simulation during the leagues' Annual Meeting and Convention Nov. 16 in Las Vegas. On Nov. 17, CNYIN will conduct a Train the Trainer workshop at Silver State Schools CU, Las Vegas.
"We have ambitious plans for 2010," Lee said. "We hope to expand our membership base to take in associate members as well as work towards increasing our involvement with more and varied business partners."
Cann to lead NASCUS CU Advisory Council
BOSTON (9/1/09)--J. Parker Cann, senior vice president and general counsel, Boeing Employees CU (BECU), began his two-year chairmanship of the National Association of State Credit Union Supervisors (NASCUS) Credit Union Advisory Council on Aug. 21 during the NASCUS State System Summit in Boston.
Cann will serve as the council chairman until 2011.
Cann, a 30-year veteran of the financial services industry, has served as both a state credit union regulator and a credit union executive. Prior to his current role at BECU, he was president/CEO of Columbia CU, Vancouver, Wash., and the chief credit union regulator for Washington state.
"My chairmanship of the Credit Union Advisory Council is occurring at a critical time for credit unions and the financial services industry as a whole," Cann said. "As we fulfill our important role as advisors to state regulators, I will continue to promote the Credit Union Advisory Council's support for state regulatory authority and the preservation of a strong state charter."
The NASCUS 2009-2010 Credit Union Executive Council, the governing body of the Advisory Council, also was announced at the meeting. The four council directors re-elected for three-year terms are:
- Ed Bibgy, Norbel CU, Colo.;
- Jim Blaine, State Employees' CU, Raleigh, N.C.;
- Catherine Tierney, Community First CU, Appleton, Wis.; and
- Mendell Thompson, America's Christian CU, Glendora, Calif.
Cann also reappointed Bob Fouch, Corporate Central CU, Hales Corners, Wis., as the council's designated corporate credit union representative for a three-year term.
This year's annual meeting was the last for Immediate Past Credit Union Advisory Council Chairman Thompson, who served as the council's leader for more than two years.
The sitting Credit Union Executive Council directors are:
- Steve Behler, Kemba CU, West Chester, Ohio;
- Jason Boesch, Oklahoma RE&T CU, Oklahoma City, Okla;
- Linda Childs, Knoxville (Tenn.) Post Office CU;
- Drema Isaac, Central Macomb Community CU, Mount Clemens, Mich.;
- Debbie Peters, INCOL CU, Old Forge, Pa; and
- Richard Rice, Teachers CU, South Bend, Ind.
The group also elected its officers. Tierney is the chairman-elect, and Bigby will serve as secretary.
MBL blog notes CUs' efforts to serve small biz
WASHINGTON (9/1/09)--A member business lending (MBL) blog addresses credit unions' efforts to get a bill passed so they can serve small business at a time when capital is tight and why it might succeed.
Monday's article in Inside Business, entitled "Credit unions try to seize the moment," says that in some congressional bills of the past, credit unions have asked for comprehensive regulatory relief in several areas.
However, the current bill--Promoting Lending to America's Small Businesses Act of 2009 (HR 3380)--addresses only business lending. It argues that because of the lack of credit from other institutions during the recession, the 12.25% of assets MBL cap credit unions have should be raised to 25% of assets.
In an environment where the government has bailed out the financial sector, the bill reinforces credit unions' message that they have remained stable. The article quotes bill sponsor Rep. Paul Kanjorski (D-Pa.) saying that permitting credit unions to expand their lending to small businesses can "work to turn around our difficult financial situation at no cost to taxpayers."
Karin Sherbin, director of governmental affairs at the Virginia Credit Union League, notes that credit unions made a political compromise in 1998 by agreed on the to get the Credit Union Membership Access Act passed. Sherbin says the cap was "to throw a bone to the banking industry. We see it as not being grounded at all in good public policy. It was just politics."
Craig Zuidema, vice president of lending at ABNB FCU, Chesapeake, Va., noted that there is enough business for everyone. Credit unions don't have the advantages that banks say they do when they complain about credit unions' tax exemption. "If credit unions were so attractive and had so many advantages, why hasn't a single bank ever converted to a credit union?" Zuidema says in the article.
The article also cites statistics provided by the Credit Union National Association on net charge-offs. At credit unions, the net charge-off on business loans was 0.33% of total loans in 2008, compared with 1.11% at banks. CUNA projects that within the first year of the potential cap increase, an additional $10 billion will be injected into the economy.
Use the link to view the entire article.
CU System briefs
- NEW YORK (9/1/09)--Municipal CU, New York, N.Y., has reported that counterfeit official checks bearing its name are in circulation, warned the Federal Deposit Insurance Corp. The items display a routing number, 011007092, which is assigned to Money Gram Payment Systems Inc., Minneapolis, Minn. The credit union issues its official checks through Money Gram via an account at The Bank of New York Mellon. The counterfeit checks have a security feature statement embedded in a darkened top border and along the bottom border between two padlocks. Authentic checks have an ornate border with a security statement below the top border and fa heat-sensitive security feature on the left side of the check. A padlock security icon is displayed next to the signature line in the lower right corner ...
- MONTEREY PARK, Calif. (9/1/09)--E1 Financial CU members
voted "yes" in favor of a merger of E1 Financial with NuVision FCU, according to a joint statement by the credit unions. The vote was certified by independent auditors on Thursday. Lynn Bowers, CEO of E1 Financial, cited increased branches and ATMs, plus opportunities for additional products and services as reasons for the vote to merge. Pending approval from regulators, the merger should be formal early in fourth quarter. The surviving credit union will be keep NuVision's name. NuVision CEO Roger Ballard will remain CEO and Bowers will become president. It will be headquartered in Huntington Beach, with branches in Los Angeles and Orange counties. Congratulating each other are, from left: Ballard; NuVision Board Chair Robert Geraci; Bowers, and John Cullum, board chair at E1 Financial CU. (Photo provided by E1 Financial CU and NuVisions FCU) ...
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Market News
MADISON, Wis. (9/1/09)
- Whether the Federal Reserve's huge infusion of credit into the U.S. economy will cause inflation to rise in the next couple of years is a matter of debate among business economists. Half of the National Association for Business Economics' (NABE) 266 members surveyed in August said they don't think inflation will result in the next few years due to the Fed's move, according to the NABE. However, 41% of economists surveyed disagree, saying inflation could result from "monetization of the debt," "lagged effects of policies now in effect," and "ineffective exit strategy." Inflation--excluding energy and food--is expected to average 3% from 2014 to 2018, according to the economists (The Wall Street Journal Aug. 31) ...
- In signs the U.S. is coming out of its deep two-year long recession, numerous reports issued Monday indicate that some regions in the country are gaining economic momentum, analysts said. Midwest business activity grew at a faster-than-expected pace in August, bringing it to the brink of expansion, according to the Institute for Supply Management-Chicago's business barometer. The gauge rose to 50.0 in August--exceeding the forecast of 48.0--from 43.4 in July. The 50-mark is considered the dividing line between growth and contraction, analysts said. However, while there was a significant increase in new orders, employment stayed soft--stoking fears that the U.S. could be experiencing a "jobless recovery" once real gross domestic product starts growing again, analysts said (The New York Times Aug. 31) ...
- The World Trade Organization (WTO) ruled Monday that American goods will see roughly $295 million in sanctions from the U.S. government's failure to stop illegal subsidies to domestic cotton growers. The amount is lower than sanctions sought by Brazil. Brazil said it was disappointed by Monday's decision. It had won several rulings against the U.S. in the past seven years. The South American country had targeted American drug patents and goods for economic retaliation totaling $2.5 billion, analysts said. The U.S. government had argued that the WTO award to Brazil should not exceed $30 million (The New York Times Aug. 31) ...
Economy's big driver still on sidelines, CUNA tells Reuters:
WASHINGTON (9/1/09)--Credit Union National Association Chief Economist Bill Hampel had the lead quote in an article widely distributed by Reuters Friday about consumer confidence and the pressure on households from falling housing prices and increasing unemployment, which translates to a reluctance to spend.
"The big driver of the economy is still on the sideline," Hampel told the news outlet. "The household sector is worried about the job market and until that shows some significant improvement, households are going to be pretty restrained," he said.
Several reports indicate that although reports about home sales and factory activity and others are seemingly upbeat, consumers likely will play a limited role in the recovery from the recession.
U.S. consumer confidence dropped to a four-month low in August, while consumer spending saw a modest increase during July, indicating what could be a lethargic recovery from the recession.
The Reuters/University of Michigan Surveys of Consumers Friday said its final index for confidence during August dropped to 65.7--the lowest measure since April. In July, the index was 66.
Meanwhile consumer spending inched up 0.2% during July, said the Commerce Department, after increasing 0.6% during June. The spending was the result of the government's Cash for Clunkers program, which fueled auto demand.
For the full article, use the link.
News of the Competition
MADISON, Wis. (9/1/09)
- Three more U.S. banks were closed Friday by the Federal Deposit Insurance Corp. (FDIC), bringing the total number of failed banks this year to 84. The closures included: Affinity Bank, Ventura, Calif.; Bradford Bank, Baltimore; and Mainstreet Bank, Forest Lake, Minn. The closures this year have cost FDIC's deposit insurance fund an estimated $446 million. The escalating number of failed banks is placing great pressure on FDIC's resources, analysts said. At the end of June, FDIC had $10.4 billion in its deposit insurance fund, compared with more than $50 billion last year. There are 416 banks on the FDIC's troubled list, meaning there are likely to be many more failures, analysts said (The Wall Street Journal Aug. 31) ...
- To curb market abuses, it is "critical" for regulators to have more access to information about derivative transactions, said Mary Schapiro, chairman of the Securities and Exchange Commission. That information will allow regulators to construct an audit trail so they can find any manipulation, insider training and other concerns that affect the whole marketplace, she added. In the aftermath of price movements causing concern last year that financial firms were approaching failure, lawmakers began studying derivatives. Derivatives are financial instruments derived from bonds, loans, stocks, currencies and commodities, or connected to specific events such as changes in the weather or interest rates (Bloomberg.com Aug. 28) ...
- The largest U.S. banks have seen the fair value of their loans steadily decline--an indication that credit markets have not yet rebounded. That raises concerns about the efficacy of government efforts to help banks weather the credit crisis, analysts said. The difference between carrying values and fair values rose 14.4% to $164.4 billion from Dec. 31 to June 30, according to federal regulators' stress tests of banks in May. The data indicate it is harder to find buyers for stressed loans, and banks' efforts to rid themselves of bad assets could be delayed, analysts said (American Banker Aug. 31) ...
Community CU conference set for October
MADISON, Wis. (9/1/09)--The 2009 Credit Union National Association (CUNA) Community Credit Union and Growth Conference is not just for community credit unions--it's for every credit union looking to reach out and grow their membership, including the young, ethnic and underserved, according to CUNA.
The conference will be Oct. 21-24 in Las Vegas.
"Ever since the 1970s, which were boom years for credit unions, membership growth has been a concern," said Todd Spiczenski, CUNA vice president, Center for Professional Development. "Annual membership growth averaged 3.9% in the 1980s, 2.5% in the 1990s, and just 1.8% since the beginning of 2000.
"Today, the time is right for a new emphasis on credit union growth," he added. "Financial publications are touting the benefits of credit unions, trust in credit unions is at an all time high, and there is a renewed consumer focus on savings and thrift. Significant growth opportunities exist within current membership fields, since only 15% of eligible members have joined."
The conference will feature two nationally known speakers. Kirk Weisler will present "Positively Contagious Leadership" and success coach Steve Chandler will focus on "Fearless Leadership."
Fourteen breakout sessions will focus on growth opportunities and challenges, including:
- Reaching Out to the Largest, Fastest-Growing, Youngest, and Most Underserved Population;
- Gen Y Return on Investment: Credit Union Strategies that Work;
- Growth Opportunities in Member Financial Rehabilitation;
- Handling Problem Loans in this Economy;
- Financial Literacy as a Growth Initiative;
- A Seat at the Table: Young Adult Directors and Board Advisers; and
- Should You Be Getting Into or Running From Small-Business Services?
Attendees also can attend a pre-conference workshop, "Building a Balanced Scorecard for Organizational Performance," led by George Towle of The Rochdale Group.
For more information, use the link.
CUSN partners with CO-OP Financial Services
LAKEWOOD, Colo. (9/1/09)--Credit Union Service Network (CUSN) has partnered with CO-OP Financial Services to offer CO-OP Mobile, which gives credit unions the ability to offer their members real-time access to their account balances, transfer money, and to find ATM and shared-branching locations from their mobile phones.
"Our goal is to become a one-stop shop for our subscriber credit unions and help them take advantage of new options and technologies to assist them in connection with their members," said Doug Burke, CUSN president/CEO.
CO-OP Mobile is integrated into the Next Generation Network (NGN) platform and has been developed to require minimal credit union capital investment. Credit unions do not need to make changes to their host or home banking system to participate. NGN provides credit union members with access to their share and loan accounts with up to 30 days of account history, CO-OP said.
CO-OP Mobile supports more than 100 mobile devices with AT&T, Verizon, Sprint, Alltel and T-Mobile.
CO-OP Financial Services is a credit union service organization in Rancho Cucamonga, Calif.
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