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Filed on September 28, 2009, published the first business day after.
- As first step toward alternative capital, CUNA backs ‘members only’
- Rep. Frank credits CUs’ role: Washington Post
- CU ‘Hikes’ blanket Capitol Hill
- In Congress: House, Senate spotlight reg reform
- Nevada’s Clearstar Financial CU closed
- Inside Washington
- Pa. Commonwealth Court rules in favor of CUs
- Two Hawaii CUs receive CDFI Native American grants
- D.C. area CUs post stellar earnings, says journal
- Three nominations in for CUNA Board
- Combined CUNA, WOCCU conference to double the impact
- Bridge account eases from savings to investing
- CDFI application help session scheduled
- CU System briefs
- Market News
- News of the Competition
- Mortgagebot allies with PCLender.com
- PSCU Financial paper’s focus: marketing to small biz
- PolicyWorks and TMG offer due diligence white paper
As first step toward alternative capital, CUNA backs ‘members only’
WASHINGTON (9/29/09)—The Credit Union National Association (CUNA)has reached out to the National Association of Federal Credit Union (NAFCU) in an effort to work together to obtain alternative capital for credit unions.
Following the adoption of a resolution by the CUNA board at its most recent meeting in Estes Park, CO, the CUNA board and President/CEO Dan Mica have directed CUNA staff to work with NAFCU on this key issue.
CUNA has reviewed draft legislative language from NAFCU and determined it is a good first step toward gaining additional sources of capital for credit unions.
However, CUNA has suggested modifications to make the member-only alternative capital legislation as broad as possible, while being consistent with the principle of mutuality.
In a memo to NAFCU, CUNA suggested that the legislative proposals be modified to include a number of additional sources for credit unions, including:
- Government assistance, including TARP funds;
- Credit union assistance to other credit unions;
- Credit union sponsors and select employee groups (SEGs) should be able to provide capital as members of a credit union, including those who have set out to make credit union access available to their employees as an employee benefit; and
- There should be exceptions to capital rules for extenuating circumstances – such as in exigent circumstances to help prevent credit unions from going into costly conservatorship or liquidation.
"The modifications CUNA is recommending to the suggested legislative proposals are aimed at helping as many credit unions as possible. We look forward to working with NAFCU on securing alternative capital," CUNA General Counsel Eric Richard said Monday.
CUNA underscored in its communication to NAFCU that, in the long term, credit unions must be allowed to determine for themselves, based on their needs and membership, whether that capital should come strictly from membership or other sources.
Drafting a legislative plan is just a first step in the pursuit of alternative sources of capital. The trades groups, once in agreement, will seek National Credit Union Administration backing of the plan. If that is secured, the groups will go on to pursue the U.S. Treasury Department's support and then seek a sponsor on Capitol Hill.
Rep. Frank credits CUs’ role: Washington Post
WASHINGTON (9/29/09)--Calling credit unions "responsible and thoughtful citizens," House Financial Services Committee Chairman Barney Frank (D-Mass.) in Sunday's Washington Post said that those financial institutions played no part in the abuses that created the need for the current financial regulatory debate that continues in Congress.
"If we only had community banks and credit unions, we wouldn't be in this problem," Frank added, noting that these financial institutions have strength in numbers "because they're in everybody's district."
Frank and fellow Rep. Carolyn Maloney (D-N.Y.) recently announced legislation what would move up the date that Credit Card Accountability, Responsibility and Disclosure (CARD) Act provisions go into effect to December from the previous effective date of February, and Frank has said that the House could pass this legislation in the coming weeks. Frank and his House and Senate colleagues also continue their work on financial regulatory reform, which Frank has said could be completed by the end of October.
CU ‘Hikes’ blanket Capitol Hill
WASHINGTON (9/29/09)--The Credit Union National Association (CUNA) on Wednesday will complete what has been a banner month for its Hike the Hill campaign with representatives from the League of Southeastern Credit Unions traveling to Washington to discuss credit union issues with their representatives and regulators.
Twelve state-based groups took part in Hike the Hill last week, helping close out what has been a memorable September for the program. A total of 25 state credit union groups are participating in Hike the Hill throughout September and October, and League of Southeastern Credit Unions President/CEO Patrick La Pine told News Now that "it has never been more important" for credit unions to show their "political grassroots strength."
"Issues that could impact credit union operations for years to come are being debated and voted on this fall in Washington, D.C.," and credit unions must not be "spectators on the sidelines" if they "want to affect a positive outcome," La Pine added.
Member business lending cap reforms, alternative capital, and the ongoing congressional conversation over general financial regulatory reform are topics for the credit union representatives.
Reps. Paul Kanjorski (D-Pa.) and Ed Royce (R-Calif.) in late July introduced legislation that would increase the current statutory MBL cap of 12.25% to 25%, and while a vote on the legislation is not close on the horizon, it remains active in the House.
The House and Senate also continue to work on their plans for financial regulatory reform, and sources have recently indicated that financial reform rules could be completed by the end of next month, with a view toward signing them into law by the end of the year.
In Congress: House, Senate spotlight reg reform
WASHINGTON (9/29/09)--While it does not appear that there will be any votes that are of interest to credit unions during the upcoming week, there will be some hearings of note.
The Credit Union National Association will submit a statement to the House Financial Services Committee as that committee on Wednesday will hold its hearing on "Perspectives on the Consumer Financial Protection Agency."
Also, on Thursday, the House Financial Services Committee will conduct a hearing entitled, "Federal Reserve Perspectives on Financial Regulatory Reform Proposals," with Federal Reserve Chairman Ben Bernanke scheduled to testify.
On the Senate side, the Banking Committee on Tuesday will discuss the "Strengthening and Streamlining Prudential Banking Supervision."
The Senate subcommittee on international trade and finance will review international cooperation in financial regulatory modernization on Wednesday, and some aspects of financial regulation will again be discussed by the Senate Small Business Committee on Thursday during a hearing entitled "Reauthorizing the Small Business Administration Finance Programs and the Impact of the Small Business Provisions of the Recovery Act."
Nevada’s Clearstar Financial CU closed
ALEXANDRIA, Va. (9/29/09)--The assets, loans and shares of Reno, Nev.-based Clearstar Financial CU have been purchased by United FCU after the Nevada Division of Financial Institutions closed Clearstar Financial on Friday.
The $144 million in assets and 16,000 members served by Clearstar will now be assumed by $941 million in assets and 78,000 member United Federal, which serves employee and association groups through 15 branch offices in Michigan, North Carolina, Arkansas, Nevada and Ohio.
Clearstar was closed due to its "declining financial condition," the National Credit Union Administration said.
Inside Washington
- WASHINGTON (9/29/09)--The Federal Reserve Board appears to be enhancing systemic risk and consumer protection regulation efforts. However, the Fed's efforts may not silence critics in Congress, according to financial observers (American Banker Sept. 28). The Fed recently announced it is working on a proposal that would limit executive compensation at financial institutions. It also said it would supervise nonbank subsidiaries of holding companies to ensure compliance with consumer protection rules. The Fed's efforts send a message that the central bank is looking to fill oversight gaps, said Cornelius Hurley, a former Fed lawyer. The actions also remind policymakers that a financial overhaul is needed while the healthcare debate continues, added Chris Low, FTN Financial chief economist. But the Fed's actions may not make any difference to several members of the Senate Banking Committee, including Chair Christopher Dodd (D-Conn.), who say that the central bank contributed to the financial crisis. Also, House Financial Services Committee Chair Barney Frank (D-Mass.) released a report last week that indicates the Fed has not used its power to protect consumers from "abusive industry practices" ...
- WASHINGTON (9/29/09)--House Financial Services Committee Chairman Barney Frank (D-Mass.) is seeking a compromise that would require the Federal Reserve Board to disclose information about its operation. Rep. Ron Paul (R-Texas) has proposed a bill since 1983 that would let the Government Accountability Office (GAO) audit the Fed. The bill has received 295 co-sponsor signatures (American Banker Sept. 28). The Fed views the bill as a threat to its independence, but Frank indicated that Scott Alvarez, Fed general counsel, said the Fed may accept a watered-down version--which would be added to regulatory reform. The GAO is not the only agency looking to investigate the Fed. Phil Angelides, chair of the Financial Crisis Inquiry commission, said he wants to investigate what role monetary policy had in the financial crisis ...
- WASHINGTON (9/29/09)--Borrowing from banks may not be the best way to boost the Federal Deposit Insurance Corp.'s (FDIC) reserves, said FDIC Chairman Sheila Bair. Bair spoke Tuesday at the Clinton Global Initiative in New York (American Banker Sept. 28). The agency can issue debt to banks, and though it's a possibility, it's not a preferred option, Bair said. However, James Dimon, CEO of JPMorgan Chase and Co., said Tuesday that the bank would lend money to the FDIC. The FDIC also could receive credit from the Treasury or charge banks another assessment. The Deposit Insurance Fund has dropped to $10 billion from $45 billion this year ...
- WASHINGTON (9/29/09)--Recorded phone conversations that took place between public officials and borrowers at Countrywide Financial Corp. has triggered more questions from Congress about a controversial mortgage program, the VIP loan program. Rep. Darrell Issa (R-Calif.) attempted to subpeona records of the loan program, but his request was turned down by committee Chair Edolphus Towns (D-N.Y.). Bank of America, which bought Countrywide in July 2008, confirmed that a recording system existed, but said all of the program's calls had been eliminated (The Wall Street Journal Sept. 28). Issa wrote the bank asking what happened to the recordings and saying that the records could help provide information about what public officials were told by Countrywide personnel about favorable treatment they had received ...
- WASHINGTON (9/29/09)--The Obama administration could commit up to $35 billion to help state and local housing agencies provide mortgages to low- and moderate-income families. The effort, which could be announced this week, aims to lift some pressure on government-operated housing agencies, known as HFAs (The Wall Street Journal Sept. 28). The agencies offer rates 0.5% lower than commercial lenders. The program could be in place for three years and would be funded by Fannie Mae, Freddie Mac and the Treasury. HFAs fund 100,000 mortgages a year. To qualify for an HFA loan, borrowers must fulfill income requirements, have good credit and verifiable income ...
- WASHINGTON (9/29/09)--World Bank President Robert Zoellick said the Treasury Department is better suited to manage financial crises than the Federal Reserve Board. He spoke Monday at a Washington university (The Wall Street Journal Sept. 28). Zoellick said it would be hard to give the Fed more authority. The Fed is considered a contender to oversee systemic risk ...
- WASHINGTON (9/29/09)--The Minnesota Credit Union Network (MnCUN) visited the National Credit Union Administration (NCUA) headquarters in Alexandria, Va.
NCUA board member Michael Fryzel welcomed the group, saying that he appreciated their open dialogue with NCUA about key issues. From left are: Ken Blazing, Mayo Employees FCU; Bill Raker, US FCU; Russ Plunkett, Postal CU; Fryzel; Chuck Albrecht, Mid Minnesota FCU; Mark Cummins, CEO of the MnCUN; Dave Boden, Hiway FCU; and Mara Humphrey, MnCUN vice president of governmental affairs. (Photo provided by the Minnesota Credit Union Network) ...
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Pa. Commonwealth Court rules in favor of CUs
HARRISBURG, Pa. (9/29/09)--The Commonwealth Court of Pennsylvania Monday overwhelmingly affirmed the state Department of Banking's procedures and decision to grant two credit unions--TruMark Financial CU and Freedom CU--expansions of their fields of membership (FOM) to community charters.
The case began in 2003 when both credit unions received community charters to serve members in five counties in the Philadelphia metropolitan area. Banks and their state trade association intervened and a series of hearings before the department and court cases made their way through the state court system. The current case was remanded from the Supreme Court.
The central concern of this case was the definition of a "well-defined local community" in determining whether the credit unions could expand. The banks claimed the banking department's decision was not supported by substantial evidence and denied them due process by limiting their access to only documents voluntarily disclosed by the credit unions.
The court was not persuaded by any of the banks' arguments. Instead, Judge Robert Simpson cited the federal parity provision found in the state law that "allows a state-chartered credit union to create, amend or expand its field of membership as authorized by Section 109 of the Federal Credit Union Act, 'subject to reasonable conditions, limitations and restrictions as may be imposed by the department including, but not limited to, conditions, limitations and restrictions based on safety and soundness.'"
"We reject banks' contention that this statutory language was meant to limit the department's discretion in dealing with community membership conversions. To the contrary, the plain language of the federal parity provision preserves for the department discretion to impose its own reasonable conditions, limitations and restrictions," wrote Judge Simpson.
Neither the federal regulation nor NCUA Manual provides a clear method to assess integration and shared community interests in determining the community, said the decision. The term "local" is "not as narrowly interpreted as banks would like. The federal regulation...specifically provides that charters consisting of 'multiple counties or local areas with populations of any size' may meet the community requirements... In view of the expansive language of the federal regulation, we cannot state that the department's broad application is prohibited," said the decision.
The court noted that "a reasonable mind could conclude based on the evidence presented that the proposed community is a well-defined local community for purposes of credit union field of membership. Therefore, we must reject banks' assertions that substantial evidence does not support the department's orders approving credit unions' conversion notices."
One argument made by banks was that the department failed to undertake an analysis of the tax consequences of the credit unions' expansion. The court found "no indication that the General Assembly harbored an unexpressed intention that the department undertake a tax analysis," and said "an implied duty of tax analysis is inconsistent with the department's express duty to act on matters within the narrow 60-day time period provided in the Credit Union Code...We presume the General Assembly did not intend such an unreasonable result."
The banking department "did not deny banks due process," said Simpson, citing credit unions' voluntary disclosure to banks of information about whether the five-county area was a "well-defined local community." "After notice, there was a full hearing on this issue... Thus, the issue of well-defined local community was robustly litigated here, and all parties received all process due on that issue."
The court noted the "current controversy between banks and credit unions arises from the federal parity provision. Therefore, it is helpful to keep in mind the process available where a federal-chartered credit union seeks to convert its membership field. Usually there is no disclosure of confidential credit union information, even where there is a Freedom of Information Act request." He noted "our conclusions regarding the process due in proceedings before the department may therefore be compared to process due before the NCUA."
The court also rejected banks argument that their right to intervene based on public interest extends beyond safety and soundness to an inquiry of all requirements for community charter conversions in the NCUA Manual. The "language of the Credit Union Code does not support such a broad reading..." and "in the absence of clear direction from our Supreme Court or from the General Assembly, we are reluctant to allow the unelected administrators of the NCUA to redefine the 'public interest' which triggers due process protections in proceedings before the department."
Banks also "did not prove that the community-based credit unions will have an unfair competitive advantage or that they will lose customers to credit unions." Banks had a chance to prove harm in the original jurisdiction part of the case but discontinued the alternate proceedings.
Judge Simpson noted that the procedures in the case included "additional safeguards which reduce any risk of erroneous deprivation of the public interest." The safeguards included a full hearing on "well-defined local community," which addressed the General Assembly's "basic requirement of a common bond for all credit unions," and the department's receipt of evidence from banks as to the safety and soundness of credit unions' proposed conversions.
Unless the banks appeal this decision to the Pennsylvania Supreme Court, all of the field of membership cases brought by the banks against the Department of Banking will have ended in a final disposition and/or been dismissed.
Two Hawaii CUs receive CDFI Native American grants
WASHINGTON (9/29/09)--Two federal credit unions were among the 10 awardees receiving $4.4 million from the Department of the Treasury's Native American Community Development Financial Institutions (CDFI) Assistance (NACA) Program.
First Hawaiian Homes FCU, Hoolehua, Hawaii, was awarded $225,000, and Molokai Community FCU, Kaunakakai, received $470,000, according to the NACA website.
Neither credit union has received official notification of the awards, and therefore are declining comment at this time, a spokeswoman for First Hawaiian Homes FCU, told News Now Monday.
The CDFI Fund's Native Initiatives work to increase access to credit, capital and financial services in communities by creating and expanding CDFIs primarily serving Native communities. This is achieved through two initiatives:
- A funding program--the NACA program--targeted to increasing the number and capacity of existing or new Native CDFIs; and
- A complementary series of training programs, called "Expanding Native Opportunities," that seeks to foster the development of new Native CDFIs, strengthen the operational capacity of existing Native CDFIs, and guide Native CDFIs in the creation of important financial education and asset building programs for their communities.
The Treasury's CDFI Fund announced the awards are being made with fiscal year 2009 appropriated dollars.
The awardees are in eight states--Alaska, Arizona, Hawaii, New Mexico, North Carolina, Oklahoma, South Dakota and Wisconsin.
"The growth in Native CDFIs is a remarkable accomplishment and their increasing reach and impact within the Native communities they serve have been tremendous," said CDFI Fund Director Donna J. Gambrell.
"We are committed to working with Native CDFIs to increase economic opportunities and bring all Native communities into the nation's economic mainstream," she added. "I am confident that the CDFI Fund's new five-year Native Initiatives Strategic Plan, which lays out our long-term, comprehensive strategy to overcoming the barriers to capital in Native communities, will greatly advance these commitments."
D.C. area CUs post stellar earnings, says journal
WASHINGTON (9/29/09)--Credit unions in the Washington, D.C., area posted "stellar" earnings in the second quarter, mostly due to substantial refunds from the federal government, the Washington Business Journal said Friday.
Local credit unions' median net income shot up 860% from a year ago to $155,728--and up from a first-quarter loss of $100,637. Also, median assets at credit unions went up 49% from a year ago to $46.2 million, leading to 20% growth in median loan portfolios from year ago to $25.2 million, according to a Journal analysis of second-quarter data from the National Credit Union Administration.
The refunds came about after federal regulators changed the way credit unions would be charged to replenish the National Credit Union Shared Insurance Fund, the Journal said.
Originally, credit unions were required to pay the entire expense in one year, but new legislation allows them to spread out payments over seven years. As a result of the change, credit unions that had paid most or all of the stabilization expense in one year, received a substantial portion of that money back through refunds in the second quarter, said the Journal.
The refunds helped 83% of the 128 locally based credit unions move into profitability for the second quarter--a marked improvement from the first quarter when only 24% posted a profit.
That indicates credit unions are doing the right thing and continuing to lend during the credit crunch, Mike Beall, CEO of the Maryland and District of Columbia Credit Union Association, told the Journal.
Three nominations in for CUNA Board
MADISON, Wis. (9/29/09)--The Credit Union National Association (CUNA) has received three nominations for its 2009-2010 board elections. All are current incumbents.
Nominees and their district categories are:
- John A. Graham, Kentucky Employees CU, Frankfort, Ky., District 2, Class A;
- Marla S. Marsh, Kansas Credit Union Association, Wichita, Kan., District 5, Class D; and
- Susan Steifel, Woodstone CU, Federal Way, Wash., District 6, Class A.
Deadline for nominations is Oct. 16. Nominations are being accepted in eight categories:
- District 1, Class C;
- District 2, Class A;
- District 3, Class B;
- District 4, Class C;
- District 5, Classes B and D; and
- District 6, Classes A and D.
Eligible candidates must be an employee or voting board member of the nominating credit union. Nominations must be in writing and seconded in writing by two other credit unions of the same size group from the district. Only two seconds will be recorded for each candidate. Upon request, a list of credit unions by size group and district will be furnished to candidates to assist in obtaining seconds.
To be an eligible league candidate for a CUNA Director position, individuals must be a league president and be nominated in writing by their league, with a second in writing by at least one other league from the district.
CUNA's Corporate Governance Committee will verify eligibility of each candidate, the credit union's affiliation, size group and district, and date/time of receipt. Voting will begin Oct. 23 and close on Dec. 18.
For more information, use the link.
Combined CUNA, WOCCU conference to double the impact
MADISON, Wis. and WASHINGTON (9/29/09)--The 1 Credit Union Conference--next year's combination of America's Credit Union Conference and Expo with the World Credit Union Conference--will provide a concentrated use of resources to help credit unions nationwide and worldwide with strategies for the challenges they face.
The 1 Credit Union Conference--one of the industry's largest conferences--is slated for July 11-14 in Las Vegas at the MGM Grand Hotel on the Las Vegas Strip. Its theme: One world, one event. Its sponsors: the Credit Union National Association (CUNA) and the World Credit Union Council (WOCCU).
CUNA expects more than 2,500 attendees from 60 countries at the global event. By budgeting now, attendees can take advantage of various discounts on early bird registration discounts before May 20, 2010. Also, special discounts are available for attendees from small credit unions under $35 million in assets, from developing countries, from the younger-than-35 set, and more.
The single professional development investment in attending will yield greater benefits, according to CUNA President/CEO Dan Mica. He noted that challenging times have meant that education and development dollars "need to bring a greater return than they ever have in the past. Our combined conference provides the best and most economical opportunity we can offer for all of us to find the resources we need to help our credit unions survive and thrive.
The combination is unprecedented. It also marks the first time the World Credit Union Conference has met in the U.S. in more than a decade, said Pete Crear, WOCCU president/CEO.
For more information or to register, use the link.
Bridge account eases from savings to investing
RALEIGH, N.C. (9/29/09)--State Employees' CU (SECU) Bridge account, introduced in 2007, is helping transition savers into investors, says the credit union.
The account provides an avenue for saving without the risk of loss associated with the stock market by offering the security of National Credit Union Administration insurance. With earnings tied to the quarterly change in the Standard & Poor's (S&P) 500 Index, the account can earn as much as 3% per quarter and did so for the second quarter of 2009.
With only one week left in the third quarter, it is likely that maximum earnings also will be paid for this quarter, SECU said.
More than 4,500 members of the $16.7 billion asset, Raleigh, N.C.-based credit union have Bridge accounts with assets totaling more than $3.5 million. Accountholders are working toward accumulating funds needed to open investment accounts at SECU, which have grown in recent months, SECU said.
Bridge accounts can be opened with a minimum of $25 and will accept deposits up to $3,000. If market returns are positive during a quarter, dividends will be paid up to the maximum rate of 3% --or a 12% annual percentage rate/12.55% annual percentage yield. If market returns are negative, no dividends will be declared for that quarter, but there also will be no loss, SECU said.
"The SECU Bridge account is an excellent no-risk tool to help members establish the savings needed to ultimately become investors," said Joan McCool, SECU senior vice president of individual retirement account and investment services.
CDFI application help session scheduled
WASHINGTON (9/29/09)--The U.S. Treasury Department's Community Development Financial Institutions (CDFI) Fund is offering a webinar workshop Wednesday to assist with applications for the 2010 round of the CDFI program.
The webinar is intended for all CDFIs interested in applying for Financial Assistance (FA) or Technical Assistance (TA) grants. CDFI staff will discuss the application process and will be available to answer questions during the 2 p.m. (EDT) webinar.
The Treasury's CDFI Fund helps locally based financial institutions offer small business, consumer and home loans in communities and populations that lack access to affordable credit, and credit unions are eligible for certification.
The Fund recently announced that it will make a total of $113 million in funding available through the upcoming year. That funding round, marking the CDFI's fifteenth year, is the largest-ever annually appropriated funding round.
Last week, National Credit Union Administration Chairman Deborah Matz encouraged credit unions to use the CDFI program as a means to "expand service to low-income consumers."
"Consumers across the income spectrum benefit when credit union service is made more accessible, and CDFI has been a reliable partner for many credit unions in making this a reality," Matz added.
The CDFI will post an archived version of the webinar on its website.
To register, use the link.
CU System briefs
- MECHANICSBURG, Pa. and WASHINGTON (9/29/09)--Two scams have been reported involving targeted credit unions. Members 1st FCU, Mechanicsburg, Pa., is warning about a texting scam that says the credit union has blocked recipients' credit cards. The message instructs recipients to call a number and "unblock" their card by entering their card number and other information (WPMT-TV Sept. 27). Also, the American Bankers Association (ABA) is alerting consumers that cash prize letters claiming to be from ABA are a fake-check scam. The fake checks for amounts ranging from $1,000 to $5,000 are listed as being from ABD FCU, Warren, Mich., but ABA says it believes other financial institutions may be targeted (The Daily News Sept. 26) ...
- ROCKVILLE, Md. (9/29/09)--During October, MCT FCU will conduct a video contest for elementary, middle or high school students in Montgomery County, Md., to stress saving. Students submit short (less than two minutes) videos that answer the question, "Why do you need to save money?" Deadline for video entries is Oct. 30 at 5 p.m. ET. MCT FCU will select winners for each type of school. Each winner will receive $500 and designated $250 of the winnings for a favorite school organization. Winning videos will be posted on MCT's website. Videos will be judged on creativity and originality, overall impact to inspire individuals to save, and message clarity and relevance to the topic ...
- DUBLIN, Ohio (9/29/09)--Ohio HealthCare FCU is offering Mobile Banking so members can access their accounts via their cell phone as part of its enhanced online banking package, CU@Home. Features added include account to account transfers between financial institutions; automated transfers between two accounts at the credit union; account alerts and enhanced security. Its new PayBills@Home online bill-pay service now offers eBills, automated payments and expedited payments. This fall, the Dublin, Ohio-based credit union also will roll out its DeposZip service to allow select members to make deposits to their accounts from their home ...
- RALEIGH, N.C. (9/29/09)--Allegacy FCU, based in Winston-Salem, N.C. will open a student-operated credit union Monday at R.B. Glenn High School, Kernersville, N.C. The partnership aims to give students experience in personal finance so they can make educated decisions about money. Sen. Kay Hagan (D-N.C.), whose first piece of legislation in Congress would provide states with incentives to expand financial literacy education, will attend the opening (Associated Press Newswires Sept. 28) ...
- GARLAND, Texas (9/29/09)--Sometimes the early bird doesn't get the worm. Case in point: a masked man with a gun tried to hold up America's CU branch in Spanaway, Texas, Friday. But he arrived before the credit union opened for business. When an employee at the $1144.2 million asset credit union refused to let him inside, then ran and hid in the back of the credit union, he left empty handed. The incident was reported at about 8:15 a.m. Friday (The News Tribune Sept. 26) ...
Market News
MADISON, Wis. (9/29/09)
- The Group of 20 (G-20) leaders and President Barack Obama are trying to put an end to the "financial balance of terror." At last week's meeting in Pittsburgh, the group adopted a framework for more sustainable economic growth in efforts to stem the worst economic downturn since the Great Depression. The G-20 also is giving a larger voice in decision-making to China and other emerging economies, analysts said. The U.S. hopes to reduce its dependence on foreign capital to finance consumption and scale back its reliance on China and other creditor nations to purchase their goods, analysts added. "Because our global economy is now fundamentally interconnected, we need to act together to make sure our recovery creates new jobs and industries," Obama said. To help provide a unified global economic front, G-20 countries are giving the 186-member International Monetary Fund (IMF) a role in assessing the efforts (Bloomberg.com Sept. 28). In a related mater, the IMF, after undertaking a broad self-evaluation, said it acted in an effective manner to mitigate the worldwide recession--especially in Eastern Europe. "Fund-supported programs are helping countries weather the worst of the crisis," the IMF report said. It is "remarkable" that countries receiving IMF loans so far have circumvented banking crises, the report added (The Wall Street Journal Sept. 28) ...
- The Federal Reserve Bank of Chicago's national activity index declined to -0.9 in August from an upwardly revised -0.56 in July. However, the three-month average rose to -1.09 from an upwardly revised -1.61. Although the index has shown significant improvement in recent months, it is still consonant with recession, analysts said. In August, the economic recovery lost some of its momentum because unemployment rose and industrial production increased by a lesser amount, analysts said. While the U.S. industrial cycle is clearly turning for the better, the improvement has been more incremental and slower than anticipated, analysts added (Moody's Economy.com Sept. 28) ...
- Global business confidence is parallel with a tentative worldwide economic recovery, according to the most recent Moody's Economy.com Survey of Business Confidence. Since the spring, most responses to the survey questions have grown more positive--with the strongest confidence in Asia and South America, and the weakest in Europe and North America, analysts said. With many businesses ending inventory drawdowns, inventories are showing the most recent improvement, the survey indicated. Earlier in the year, inventories had been a substantial drag on the economy, Moody's said. Manufacturers' responses also are much more upbeat, analysts added. However, sentiment has remained mostly unchanged since August, after improving markedly between mid-April and early August. This indicates that the recovery is not moving rapidly into a self-sustaining economic expansion, analysts said (Moody's Economy.com Sept. 28) ...
News of the Competition
MADISON, Wis. (9/29/09)
- Federal regulators Friday shut down Georgian Bank in Atlanta--marking the U.S. banking industry's 95th failure this year. The bank's failure likely will cost the Federal Deposit Insurance Fund roughly $892 million, analysts estimated. Mostly because of bad loans in the commercial real estate sector, hundreds more banks nationwide are expected to fail in the next few years, analysts said. The Federal Deposit Insurance Corp.'s (FDIC) confidential "problem list" had 416 banks at the end of June--up from 305 in first quarter and the highest number since June 1994, during the savings-and-loan crisis, analysts said. Georgia has had 19 bank failures this year--the most of any state. The FDIC has roughly $50.2 billion in its fund, of which 20% will be depleted by the recent IndyMac failure, analysts said (examiner.com Sept. 28) ...
- With U.S. capital markets reopening, many healthy banks were able to raise capital in recent weeks. Most have done so to seize acquisition opportunities or else to repay funds they accepted under the Treasury Department's Troubled Asset Relief Program, analysts said. Most were considered to be among the most robust banks. However, now some capital seems to be flowing to banks that need to satisfy a regulatory enforcement agreement, analysts said. As an example, Synovus Financial Corp., a $24 billion asset, Columbus, Ga.-based bank, completed a $600 million offering last week--with a memorandum of understanding still pending with the Federal Reserve. The capital market has grown for banks, said Tim O'Brien, managing director at Sandler O'Neill & Partners. This could be because the market is giving more help to healthier banks that are encouraged by regulators to raise capital--or it could be that examiners are more behind the issue "because the market is more supportive in raising capital," he added (American Banker Sept. 28) ...
Mortgagebot allies with PCLender.com
MEQUON, Wis. (9/29/09)--Mortgagebot announced a new alliance with PCLender.com to recommend the Mortgagebot PowerSite point-of-sale (POS) platform to PCLender's clients and prospects as a preferred solution.
PowerSite is a hosted software solution. It handles mortgage application, pricing and approval processes for more than 900 lenders nationwide, including credit unions. PCLender.com is a provider of web-based mortgage lending solutions.
The alliance will allow PCLender.com clients to access mortgage POS tools to help them serve borrowers, manage greater application volume and maintain regulatory compliance, Mortgagebot said.
"Mortgage lenders are increasingly turning to advanced POS automation as a means of reducing costs, increasing efficiency and providing better service," said Dan Welbaum, Mortgagebot chief marketing officer.
The PowerSite platform has three parts: PowerSite Consumer, a self-serve mortgage website; PowerSite Advisor, which allows non-mortgage associates to take mortgage applications after a brief training session; and PowerSite Pro, an add-on product for loan officers.
PSCU Financial paper’s focus: marketing to small biz
ST. PETERSBURG, Fla. (9/29/09)--PSCU Financial Services has issued a third white paper on small businesses.
The paper, "SMBs: A Unique Marketing Environment," focuses on marketing to small business owners by discussing the development of sales relationships and the difference between small businesses and the rest of the corporate world.
Selling financial services to small businesses has a two-fold set of challenges. First, small business owners are a hybrid audience. Their product and service needs are similar to their corporate counterparts, yet the centralized nature of their decision-making differs greatly. Second, small business owners don't necessarily want to be "sold"--they seek long-term relationships, which offer key benefits for credit unions, the paper said.
Two previous papers discussed the financial needs of small business owners, and how to create a customized small business program that manages risk and includes measurement tools.
The next white paper will be, "Prospecting for Small Business Customers," which will focus on creating a common profile using the right data to reach small businesses. The data "can be used to guide your offers and programs and create clearly targeted, industry or sector-based messaging, which works to build strong, ‘sticky' relationships," PSCU Financial Services said.
PolicyWorks and TMG offer due diligence white paper
DES MOINES, Iowa (9/29/09)--PolicyWorks and The Members Group (TMG) have partnered to offer a white paper on due diligence practices.
"Do Your Homework; Pass the Exam--Satisfying the National Credit Union Administration with Vendor Selection Due Diligence" outlines a seven-step due diligence process that credit unions can use when selecting a card processor.
The relationship a credit union has with its vendor for card processing is the most critical vendor relationship a credit union can have, said Andrea Stritzke, PolicyWorks regulatory counsel.
Card processors drive a vital revenue-generating activity for credit unions and house secure member data, Stritzke added.
PolicyWorks, based in Iowa, offers regulatory compliance resources for credit unions. TMG is owned by the Iowa Credit Union League and offers customized solutions for credit unions nationwide including credit, debit, ATM and prepaid cards.
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