News Now Archive

Filed on October 9, 2009–October 11, 2009, published the first business day after.

• CUNA moves forward on alternate capital proposal
• 21-day fix scheduled for House vote Tuesday
• Postcard campaign launched to back CUNA interchange effort
• NCUA, other key players, at White House bid for CFPA
• Inside Washington
• CUs ready for Thursday's big event: ICU Day
• Slovak Republic to re-establish CUs
• Home & Family Finance refocuses to online
• Developers lose lawsuit vs. IH Miss. Valley CU
• North Carolina program prevents 2,000 foreclosures
• Illinois REAL Solutions CUs discuss innovations
• Washington state CU leaders honored
• New Washington foundation exec officers elected
• CU System briefs
• Conn. league CEO addresses reg challenges in biz journal
• Market News
• News of the Competition
• Are there any deals left on new cars?
• CU Business Group hits $2 billion in MBLs
• Harland Financial Solutions has two new CU services

CUNA moves forward on alternate capital proposal

WASHINGTON (10/12/09)—The Credit Union National Association (CUNA) is moving forward with a proposal to the National Credit Union Administration on additional capital for credit unions as a result of an agreement with the National Association of Federal Credit Unions(NAFCU).

Under the proposal, credit unions would be allowed to obtain alternative capital from their members and limited other sources, according to CUNA President/CEO Dan Mica.

Mica said Friday, "This proposal has potential for giving credit unions access to additional strength to help them weather economic downturns and other strains on their capital base. It is the result of careful consideration that began with the CUNA board meeting in Estes Park, Colo., last month, and subsequent discussions with NAFCU."

Mica added that the proposal will soon be forwarded to NCUA for its review and concurrence. "With CUNA and NAFCU now in agreement, CUNA strongly believes that the agency has an opportunity to act with Congress in this current environment," CUNA's leader said. He noted that CUNA will also be working with the National Association of State Credit Union Supervisors on the proposal.

The proposal would allow credit unions to accept and count as capital funding from such sources as:

• Members of the credit union;
• Sponsors and member select employee groups of CUs; and
• Assistance provided to credit unions by government in limited circumstances (such as Section 208 assistance).

In each of these cases, the additional capital would not be federally insured and could pay a higher return on interest. The additional capital would also be subordinated to other claims against the credit union.

"We are hopeful the NCUA can soon review this proposal, so that the credit union movement can move forward in a united fashion in presenting it to the Congress for full consideration," Mica said.

"In today's financial climate, we feel an urgency and opportunity exists for congressional action to assist the nation's credit unions in best serving their members."

21-day fix scheduled for House vote Tuesday

WASHINGTON (10/12/09)—A bill intended to fix a troublesome 21-day disclosure provision in the Credit CARD Act is scheduled to be considered by the House tomorrow.

The legislation, H.R. 3606, or the CARD Act Technical Corrections Act, has been placed on the House suspension calendar, generally reserved for bills not considered highly controversial.

H.R. 3606 was introduced by Rep. Peter Welch (D-Vt.) and last week the Credit Union National Association (CUNA) sent a letter to the leadership of the House Financial Services Committee urging support for the measure.

The legislation would amend Section106 of the CARD Act, a provision that prohibits creditors from declaring a payment as being late unless the creditor adopts reasonable procedures to ensure that periodic statements are mailed or delivered to the consumer no later than 21 days before the payment due date.

As written, the section applies to all open-end loans, including general lines of credit, lines of credit associated with share draft and checking accounts, signature loans, and other forms of loans, not just credit cards.

Welch's bill would insert the words "a credit card account under" into Section 106, thereby removing its application from the other forms of open-end credit.

CUNA has been working closely with House leaders and Welch to bring the technical correction bill to a House vote. The group believes the provision was originally intended to cover only credit card accounts and was inadvertently changed during the legislative process.

CUNA has highlighted problems faced by credit unions due to complications caused by the current structure of the CARD Act provision and warned that credit union members could face increased costs and reduced services if technical corrections are not made.

Postcard campaign launched to back CUNA interchange effort

WASHINGTON (10/12/09)--The Credit Union National Association (CUNA) will continue its interchange grassroots advocacy by launching a new postcard campaign to voice credit union views on the issue, aiming to send 250,000 cards to the Senate in October.

The postcards, which look like a credit card bearing the iconic credit union little guy, have been mailed to state credit union leagues for distribution to natural person credit unions during the week of October 12.

Click for larger view

CUNA has provided credit union management with a letter which explains the issue to their employees, and those tellers will then also seek to briefly educate their credit union members on the interchange issue.

The postcards may then be handed out by employees, such as tellers, to credit union members as they do business at their local branches.

Once the postcards have been signed by credit union members, they will be forwarded on to Senators on an at least weekly basis. Postcards may also be mailed individually, but all postcards will need to be mailed by November, according to CUNA.

CUNA has also provided interchange talking points as well as other artwork and communications materials which may be tailored by credit union leagues and individual credit unions.

CUNA has fiercely opposed merchants proposals that would affect interchange fees. Interchange reflects a merchant's fair share of the costs of the convenient card system and supports everything from re-issuing cards compromised by merchant data breaches to providing a call center to contact if a card is lost or stolen.

The issue of interchange fees loomed large on Capitol Hill last week, with Local Government FCU Executive Vice President and CUNA representative Mark Caverly telling legislators at a Thursday House hearing that government intervention into the interchange fee system would reduce consumer choice and allow merchants to discriminate against credit unions and other small card issuers.

NCUA, other key players, at White House bid for CFPA

WASHINGTON (10/12/09)—The White House Friday called together a variety of Washington players to make another bid for support for the administration's proposed Consumer Financial Protection Agency (CFPA) and among them, according to the National Credit Union Administration (NCUA), was that agency's chairman.

Along with NCUA Chairman Deborah Matz was Federal Deposit Insurance Corp. Chairman Sheila Bair, U.S. Treasury Secretary Timothy Geithner, as well as key members of the U.S. Congress, such as Rep. Paul Kanjorksi (D-Pa.) and Senate Banking Committee Chairman Christopher Dodd (D-Conn.).

When asked for a comment, NCUA Director of Public and Congressional Affairs John McKechnie said, "The Chairman shares the President's commitment to enhancing consumer protections, and is prepared to work with Congress on the evolving proposal."

The Obama administration introduced CFPA legislation in June. The bill seeks to protect consumers of financial products through the creation of a powerful independent agency with extensive rulemaking, oversight, and enforcement tools.

The House Financial Services Committee announced last week that a discussion draft of the Consumer Financial Protection Agency Act of 2009 (H.R. 3126) is among four bills slated for a vote on Oct. 14.

Inside Washington

• WASHINGTON (10/9/09)--House Financial Services Chairman Barney Frank (D-Mass.) told reporters last week that action on an interchange bill is an "open question." He called his committee's hearing on the issue Thursday, at which the Credit Union National Association (CUNA) testified on behalf of credit unions, the beginning of a serious look at the issue, but told the press that he had no immediate plans beyond the hearing. The chairman noted that support for interchange fee legislation has been stronger in the Senate than it has been in the House. The difference between legislative bodies was the reason that interchange fee provisions were not included in credit card legislation passed earlier this year (American Banker Oct. 9). A separate story in the same issue noted that VISA Inc. launched an advertising campaign in Washington intended to spotlight the benefits of credit and debit cards over paper checks and money. Early in the week, print and digital ads appeared in D.C. and on Thursday--hearing day--television and radio ads began airing. On the other side of the issue, 7-Eleven Inc. and other retailers have run an intense campaign in favor of government restrictions on interchange fees. Gathering signatures in its shops over the summer, 7-Eleven delivered a petition to federal lawmakers with more than 1.66 million signatures backing interchange fee regulation. VISA and MasterCard have revealed studies that conclude consumers did not fully understand the issues involved in the petition. CUNA testified that regulation of interchange fees would interfere with consumer choice ...

• WASHINGTON (10/12/09)--The Treasury Department announced that more than 500,000 trial loan modifications are in progress under the Making Home Affordable Program. The goal was originally set to reach 500,000 modifications by Nov. 1. Though modifications are being issued at a faster rate than new homeowners are becoming eligible, the Obama administration said it believes that "more can and should be done to assist struggling homeowners and to stabilize the housing market." Senior Treasury Department and Department of Housing and Urban Development officials planned to discuss improving servicer efficacy and responsiveness to borrowers during the modification process in meetings Thursday ...

• WASHINGTON (10/12/09)--Steps are needed to address transparency and accountability challenges in the Troubled Asset Relief Program (TARP), the Government Accountability Office (GAO) said in a report. As of Sept. 25, Treasury had disbursed $364 billion in TARP funds, but it has yet to update its projected use of funds for most programs. The projections will consider current market conditions, program participation rates and repurchases. The GAO expects the department's ability to plan for and execute the plan's next steps will be limited without more estimates about expected uses for the fund and the amount of money left. The GAO recommends that Treasury Secretary Timothy Geithner coordinate with the Federal Reserve and Federal Deposit Insurance Corp. (FDIC) to ensure that the decision to extend or eliminate TARP is considered in a broader market context; document and communicate the results of its determination; and update its projected use of funds. Treasury agreed with the first two recommendations, but regarding the third recommendation. The department said it regularly re-evaluates funding needs ...

• WASHINGTON (10/12/09)--Senate Republicans Thursday pushed to include Fannie Mae and Freddie Mac into regulatory reform. Sen. Richard Shelby (R-Ala.) said the Obama administration made no effort to include the government-sponsored enterprises (GSEs) in its proposal. Instead, it said the GSEs would be dealt with next year--a move Shelby questioned during a Senate Banking Committee hearing. Sen. David Vitter (R-La.), agreed, saying it was odd Fannie and Freddie are "nowhere on the radar." Committee Democrats avoided discussing the GSEs' absence from the plan (American Banker Oct. 9). Taxpayers will have to eat the GSEs' losses, said Peter Wallison, American Enterprise Institute fellow. Also during the hearing, Sen. Tim Johnson (D-S.D.) asked William Shear, Government Accountability Office (GAO) director of financial markets, how the proposed reform would affect mortgages. The GSE structure addressed regional disparities in mortgage rates, Shear said. The current financial system is large and diverse...a return to regional disparities is unlikely, he added ...

• WASHINGTON (10/12/09)--Rep. Darrell Issa (R-Calif.) has challenged the Federal Reserve Board and the Treasury Department to explain documents indicating the government was aware of $3.6 billion in bonuses Merrill Lynch distributed, despite earlier claims that the government didn't know about the bonuses (American Banker Oct. 9). Joe Price, the bank's chief financial officer, said he gave the Treasury and the Fed documents about the bonuses on Dec. 17. Former Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke have said they did not know about the bonuses prior to Merrill's merger with Bank of America. The company wasn't hiding information from the government, Issa said in a letter to Bernanke and Paulson. If the bonuses were unfair, the government should have raised questions or objected before the company gave out another $20 billion of taxpayer money, Issa said ...

CUs ready for Thursday's big event: ICU Day

MADISON, Wis. (10/12/09)--This week is Credit Union Week, and Thursday credit unions will celebrate their efforts for the 61st consecutive year on International Credit Union Day--always on the third Thursday of October--which is also National Cooperative Month.

This year's theme, "Your Money. Your Choice. Your Credit Union," celebrates why 177 million people worldwide choose credit unions. The event is sponsored by the World Council of Credit Unions and the Credit Union National Association (CUNA).

Credit unions are already reporting what they will do to celebrate this week, and officials in several cities and states have issued or will issue special proclamations recognizing credit unions.

For example, Idaho Gov. C.L. "Butch" Otter last week proclaimed Oct. 15 as International Credit Union Day, says the Idaho Credit Union League.

In Kaua'i, Hawaii, Mayor Bernard Carvalho Jr. issued a similar proclamation stating that credit unions on the island contribute significantly to the economic well-being of Kaua'i's communities and to an improved standard of living among its members and their families (Kauaiworld.com Oct. 7) .

Most of Idaho's 59 credit unions will observe the day by serving cookies and other treats to their members, said the Idaho league. Others will conduct auctions and fundraisers to benefit charities such as the Children's Miracle Network. Still others will host member activities throughout the week.

Those scenes will be repeated throughout the nation. Among the special activities:

• Educational CU, Topeka, Kan., will host four opportunities this week for the community to "pay it forward," with the potential for members to win additional money and benefit themselves and the charity of their choice. The credit union will provide $20 to the first 25 people who arrive at specific branches and make a brief video about how they would use the money to pay it forward. They will later e-mail a follow up telling what they did with the money and how it was received. The videos will be uploaded to the credit union's YouTube page at www.educationalcu.org so the public can vote on them. The video participant with the most comments by Nov. 2 will receive $500 and an additional $500 for a charity of their choice (WIBW-TV.com Oct. 7).

• Northeast CU, Portsmouth, N.H., indicated is inviting community members to celebrate Thursday at its branches and offering snacks and refreshments.

• Redwood CU, Santa Rosa, Calif., said it will celebrate with free educational seminars open to members and the public, a coloring contest for kiddies, a $100 member raffle, giveaways and more. It will conduct workshops on Financial First Aid, Budget-Wise Teens, Money & Me (for ages 6 to 12) on Tuesday and Thursday.

"International Credit Union Week is an opportunity to thank our members for their business and to raise general awareness of the many benefits that credit unions offer our communities, including affordable financial services and free financial education," said Redwood President/CEO Brett Martinez.

"Credit unions continue to be safe and sound, and provide a full range of financial products and services while remaining committed to serving and investing in our local communities," Martinez added.

A number of credit unions shared their plans with CUNA. Use the resource link to find out what they are planning for this week.

Resource Links

CUs' plans for ICU Day

Slovak Republic to re-establish CUs

BRATISLAVA, Slovak Republic (10/12/09)--The Slovak Republic, with the help of the World Council of Credit Unions (WOCCU), is working to re-establish credit unions in that country.

In 1845, cooperative pioneer Samuel Jurkoviè founded one of Eastern Europe's first credit unions in the village of Sobotište in what is now the Slovak Republic. Today, there are no credit unions left in

Sobotište Mayor Dana Ceranova (left) displays the village guest book with the help of World Council of Credit Unions (WOCCU) Brian Branch (Center) and the National Association of Cooperative Savings & Credit Unions Pawel Grzesik. The Slovak Republic, with the help of WOCCU, is working to re-establish credit unions in the country.

the village, according to Dana Ceranova, Sobotište's mayor. As a result, the village's inhabitants are paying higher prices for financial services, a situation the global credit union movement would like to change, WOCCU said.

Ceranova and a small group of grassroots organizers want credit unions to return to the Slovak Republic, and have enlisted aid from WOCCU and the National Association of Cooperative Savings & Credit Unions (NACSCU)--WOCCU's member organization in Poland. They will work with the republic's national government to establish regulatory standards to help credit unions flourish again.

"There is no legislative framework for credit unions here," said Leonard Hölbling, board member of the Slovak Association of Savings Cooperatives (SASC), which is helping spearhead the initiative. "We want to establish the proper legislative framework informed by international best practices."

Credit unions have spread throughout Eastern Europe during the past two decades because of the efforts of WOCCU and NACSCU--which provided extensive credit union development assistance in Belarus, Macedonia, Moldova, Russia and Ukraine.

Due to a high level of interest on the part of its people, the Slovak Republic may be the next country to experience the growth of financial cooperatives, explained Brian Branch, WOCCU's executive vice president and chief operating officer.

"Two things must exist for credit unions to thrive--interest and support of the people being served, and the proper legislative and regulatory infrastructure," said Branch, who recently visited the

World Council of Credit Unions' Brian Branch (left) greets Slovak Republic Parliament Vice President Miroslav Cíž. (Photos provided by World Council of Credit Unions)

country with Pawe³ Grzesik, plenipotentiary head of NACSCU's Warsaw office. "Slovakians have expressed an interest, and our hope is that we can help them affect the proper legislative and regulatory solutions," Branch added.

In support of SASC, Branch and Grzesik met with officials from the republic's Central Bank, Ministry of Finance, Ministry of Foreign Relations and Parliament in Bratislava to discuss policy framework for credit unions in a country dominated by urban retail banking. The delegation stressed the benefits of credit unions as lower-cost consumer alternatives outside of urban areas, particularly in villages like Sobotište.

As cost-effective alternative providers, credit unions exert competitive pressure on rates and fees while maximizing value to consumers rather than profits for shareholders, Branch told government officials, including Miroslav Èíž, vice president of the republic's parliament.

Slovak Republic policymakers expressed concerns based on experiences with financial speculators and manipulators who used cooperative models to disguise pyramid schemes that negatively affected the country's economy. Local credit union organizers and delegation members explained how cooperative governance principles and prudential regulations properly exercised can better control risk and ensure the true cooperative management of registered credit unions.

"Mr. Èíž responded that the Slovak Republic needs credit unions' social outreach to serve marginalized populations currently being ignored by banks," Branch said. "He agreed to support credit union development to accomplish this goal."

Four savings cooperatives exist in the republic. All are registered under a civil code that allows them to accept member deposits to invest in the stock market but does not allow them to make member loans.

The Slovak Republic is the latest focus in WOCCU's ongoing collaboration with NACSCU to develop credit unions. Efforts to help the republic's growing credit union movement will draw heavily on NACSCU's past successes within the region, Branch said.

Resource Links

World Council of CUs

Home & Family Finance refocuses to online

MADISON, Wis. (10/12/09)--The Credit Union National Association (CUNA) has decided to focus its Home & Family Finance resources on its online product, which delivers new content at least three times a week to subscribing credit unions that serve more than 20 million members nationwide.

"CUNA has made a big commitment to providing financial education on the Web," said Jim Hanson, vice president of CUNA's business-to-consumer publishing operation, which focuses on financial education. "Home & Family Finance Resource Center is a much more robust product than any print product could deliver and is just one of six online tools that we developed to help credit unions reach specific market segments. With each of these tools, credit union members can access money management information anytime and learn at their own individual pace."

"And the fact is that more and more consumers are getting their information online today," added Susan Tiffany, Home & Family Finance editor and director of periodicals. There will also be a significant cost savings on distribution, she said.

However, the decision means that after 49 years of publishing, Home & Family Finance magazine will no longer be a print product. The final issue came off the press last week.

CUNA launched Everybody's Money, the magazine's original name, as the 13th issue of The Bridge, now known as Credit Union Magazine, in 1961. Everybody's Money was a quarterly digest-sized product devoted to money management. Its circulation grew to 2.5 million in 1973. The name was changed to Home & Family Finance in 1998.

CUNA's Web-based Home & Family Finance Resource Center, launched in 1997, will continue to deliver the same kind of money management information online that the magazine delivered in print. The center also provides a virtual library of information, including calculators, videos and articles surpassing the potential reach of a print product.

People in online learning conditions perform better than those receiving face-to-face instruction, according to a recent study conducted by SRI International for the Department of Education. The report examined comparative research on online vs. traditional classroom teaching from 1996 to 2008. Most of the studies were conducted in colleges and adult continuing-education programs.

Hanson noted that CUNA started building online financial literacy tools in 1997, "well ahead of today's rediscovery of financial education."

"I've had a number of subscribing credit unions tell me they are sad to see the print product going away," Tiffany said. She has been associated with 111 of the 196 printed issues. "And I tell them that we do have print materials available to them. But most have been excited to learn more about online options. After all, now they can reach all their members 24/7, not just a select few."

Resource Links

Home & Family Finance Resource Center

Fundamentals of Personal Finance books

Statement Stuffers, Lobby Brochures, and Drive-Up Envelopes

Seminars in a Box

Developers lose lawsuit vs. IH Miss. Valley CU

DAVENPORT, Iowa (10/12/09)--Two property developers involved in a failed condominium complex lost their $16 million lawsuit against Moline, Ill.-based IH Mississippi Valley CU, on all six counts.

The suit was filed by Cypress Point Developments, operated by Niky and Thomas Bowles, after the credit union filed for foreclosure against them. They claimed the credit union wanted out of a $3.5 million loan to develop the complex in Davenport, Iowa, because it had locked in a lower interest rate (News Now Sept. 30).

The credit union countered that the Bowleses knew the provisions of the loan called for six-month extensions.

But a Scott County District Court judge and jury ruled last week in favor of the credit union (Quad-City Times Oct. 8). The decision now clears the way for the court to determine whether the foreclosure should be placed on the property.

Trial judge Mary Howes ruled in favor of the credit union on three of the six counts before the case went to the jury. The jury ruled in favor of the credit union on the final two counts after an eight-day trial and two hours' deliberation.

The six counts were: breach of contract, interference with third-party contracts, negligent misrepresentation, fraudulent misrepresentation, breach of fiduciary duties and slander.

The condominium project has spawned several lawsuits from contractors, most of whom won. The property has nearly 10 years of lawsuits, land disputes and zoning fights.

North Carolina program prevents 2,000 foreclosures

RALEIGH, N.C. (10/12/09)--State Employees' CU (SECU) is part of a State Home Foreclosure Prevention Project in North Carolina that has helped more than 2,000 homeowners avoid foreclosure.

The project in which the $16.7 billion asset, Raleigh, N.C.-based credit union participates, has been in operation for 10 months (Citizen-Times.com Oct. 8).

The project has helped prevent 2,040 foreclosures in North Carolina and also has provided foreclosure prevention and budgeting advice to more than 6,000 homeowners, the newspaper said.

Avoiding foreclosures on these homes has prevented $175 million in declines in neighboring property values and financial system losses, according to the North Carolina Office of the Commissioner of Banks, the paper said.

North Carolina foreclosure filings are up 10.6% this year due to the economic downturn and job losses, the paper said.

Resource Links

CUNA Residential Loan Promotions

Mortgage Trouble? Visit Your CU statement stuffer

Outsmart Foreclosure Scams statement stuffers

CUs in the Media

Illinois REAL Solutions CUs discuss innovations

NAPERVILLE, Ill. (10/12/09)--Illinois REAL Solutions partner credit unions met to discuss the latest innovations and initiatives of the Filene Institute's i3 group.

Jean Theis, vice president of operations at Motorola Employees CU, Schaumburg, Ill., tells Illinois REAL Solutions partner credit unions about a Debt in Focus web interface initiative to help members get anonymous debt management advice

Frank Weidner, senior vice president of member services at Alliant CU, Chicago, describes the latest projects of the Filene Research Institute's i3 group, a group that explores ideas, innovation and implementation for credit unions, to credit union partners of Illinois REAL Solutions. (Photos provided by the Illinois Credit Union League)

The i3 group identifies and evaluates recent credit union innovations that meet members' needs, lower costs or increase efficiencies, build member loyalty, meet niche needs. and enhance credit union effectiveness.

Jean Theis, vice president of operations at Motorola Employees CU, Schaumburg, told credit unions about a Debt in Focus Web interface. Rolled out in June, the initiative provides credit union members with anonymous debt management advice and delivers an actionable plan to help reduce debt and improve members' credit profiles. The tool provides the members with a summary of their debt.

According to Filene, 62% of the U.S. population has less than $100,000 in assets. They represent 12% of consumer assets nationwide and are overlooked by today's financial advisers, Theis told the group. They struggle with day-to-day life decisions, including debt counseling, home and auto financing, college savings and retirement savings. Credit unions have an opportunity to build on their strong reputation of trust by giving members a way to analyze their own debt situation and by laying out an action plan to make improvements, she said.

Theis also provided updates on other i3 innovations.

Representatives from Alliant CU, Chicago, described that credit union's innovations.

Joe McGowan, Alliant director of marketing, presented Friends and Benefits, a customized benefit initiative being piloted by the credit union. The program summarizes the value of each member's relationship with the credit union. Its report displays for the member what they have saved or earned above what they would expect at another financial institution.

The objective is to demonstrate that the credit union offers the overall greatest value to the member, McGowan said. Also, the benefits statement means the credit union can learn more of the members' business by including offers of loans and other products for which they are eligible. Alliant plans to expand the pilot to a larger, targeted audience and produce an online version as well as a print version. Elements of the report will be included in statements and online banking.

Frank Weidner, Alliant CU senior vice president of member services, provide an overview of several of the latest i3 products. These included:

• The Leap, a Web platform aimed at Gen Y regarding sustainable "green" products available at credit unions;

• Share the Wealth, a home equity referral program;

• The Giving CD, a concept to use the financial power of credit union members to provide funds for development and expansion support of other cooperatives;

• Responsible Rent, a loan program for investment property owners in times of foreclosures and depressed home values; and

• Credit Union Benefits for Employees, a pooling approach for credit unions to jointly purchase healthcare insurance and benefits.

The Illinois Credit Union League and Illinois Credit Union Foundation have teamed up with the National Credit Union Foundation to offer REAL Solutions for Low Wealth Households. There are 45 credit unions involved in REAL Solutions in Illinois.

Resource Links

REAL Solutions

Illinois' REAL Solutions

Washington state CU leaders honored

FEDERAL WAY, Wash. (10/12/09)--The Washington Credit Union Foundation honored several credit unions and representatives during its Summit Awards program Sept. 17.

The awards are named in honor of a trek that 21 credit union professionals took to Mt. Rainier in Washington 25 years ago. The group was led by Bruce Rouillard, former Washington Credit Union League president.

Washington State Employees CU (WSECU) President/CEO Kevin Foster-Keddie received the 2009 Mark of Excellence Award, the highest statewide honor. The award is given to individuals who have displayed 25 years or more of credit union leadership. Foster-Keddie was one of the leaders who helped create a shared branching initiative in Washington. He also developed the first cooperative television advertising campaign. WSECU is located in Olympia.

Other awards included:

• The Outstanding Credit Union Volunteer Award, presented to Graeme Sackrison, board member, Generations CU, Olympia;

• Distinguished Credit Union Professional of the Year Award, given to Tumwater-based O Bee CU President/CEO Bruce Cramer;

• The Legacy Award, presented to Harborstone CU, Tacoma; and

• The Desjardins Youth Financial Education Award, given to Spokane (Wash.) Teachers CU.

The foundation also presented four Dora Maxwell Social Responsibility Awards to:

• SnoCope FCU, Everett, $20 million to $50 million in assets;
• O Bee CU, $100 million to $200 million;
• Horizon CU, Spokane, $200 million to $500 million; and
• GESA CU, Richland, more than $500 million.

Resource Links

Dora Maxwell Social Responsibility Award

New Washington foundation exec officers elected

FEDERAL WAY, Wash. (10/12/09)--The Washington Credit Union Foundation (WCUF) board of directors recently elected the foundation's executive officers.

The elections were conducted at a meeting held in conjunction with the Washington Credit Union League's annual convention in Bellevue, Wash.

The board voted to promote Paula Slaye, chief financial officer of Catholic CU, Yakima, to chair. Slaye served on the WCUF board for the past seven years--most recently as vice-chair.

Also elected were:

• Vice Chair--M. Earlene Fantz, CEO, American Lake CU, Tacoma;

• Treasurer--Steve Wilder, Horizon CU, Spokane; and

• Secretary--Gayle Yost, Community Health CU, Everett.

CU System briefs

• DALLAS (10/12/09)--Robert "Rob" Kyker, owner of R&D Sales and Leasing, Richardson, Texas, has been appointed to the Texas Credit Union Commission by Gov. Rick Perry. His term will expire Feb. 15, 2015. The commission supervises the Credit Union Department, which regulates all state charter credit unions. He is a volunteer leader with the Boy Scouts of America and as a national spokesperson for its Emergency Preparedness Committee, and volunteers for several other community organizations (The Advocate Oct. 9) ...

• WASHINGTON. (10/12/09)--Brian Branch, executive vice president and chief operating officer of the World Council of Credit Unions (WOCCU), will be among the experts featured on a webcast about Individual Development Accounts (IDAs) and other matched savings programs Wednesday at 12:15 p.m. EDT. The webcast is sponsored by New America Foundation of Washington, D.C. and will spotlight WOCCU's new program in Mexico, MatchSavings.org, where online donations are used to match the first savings account of the poor. The event will launch the Global Assets Project to promote savings as a tool for international development and discuss WOCCU's model as it relates to savings promote, financial inclusion and asset building. For more information, use the link ...

• Click for larger view

  ALBUQUERQUE, N.M. (10/12/09)--Dave Seely, president/CEO of Kirtland FCU, pictured at far right, was part of a hot air balloon crew last week during the Albuquerque International Balloon Fiesta. The balloon he crewed for was sponsored by CO-OP Financial Services Network and CU Anytime ATM network, according to the Credit Union Association of New Mexico. On average, about 500 hot air balloons ascended each day of the annual balloon festival. (Photo provided by the Credit Union Association of New Mexico) ...

Conn. league CEO addresses reg challenges in biz journal

MERIDEN, Conn. (10/12/09)--Credit Union League of Connecticut President/CEO Tony Emerson was spotlighted Oct. 9 in the Hartford Business Journal in a question-and-answer feature.

Emerson addressed the burden of regulatory changes that credit unions face today and regulatory challenges they anticipate for 2010.

He noted that in light of today's regulatory and compliance burden on financial institutions, credit unions--no matter their asset size--are all expected equally to comply with heavy regulation demands.

The Journal was particularly interested in the league's new Compliance School, scheduled for February through July and which covers major regulatory compliance issues, he said. The league's Small Credit Union Support Program is subsidizing the costs so credit unions with less than $20 million in assets can attend free, he said.

The league also has scheduled a compliance forum for November, he added.

Market News

MADISON, Wis. (10/12/09)

• For the first time in four months, the U.S. trade deficit unexpectedly narrowed to $30.7 billion in August from July's $32 billion deficit. In August, exports rose to their highest level in 2009, and imports eased despite higher oil prices, analysts said. Exports were up $200 million from the month before, but imports were down $900 million. The recent upsurge in oil prices had forced the trade deficit back up, after a short dip when the recession gutted demand for imports, analysts said. Meanwhile, exports experienced a five-month uptick, which is a good sign for the future economic outlook, they added. "As the global recovery strengthens, it will help exports," said Guy LeBas, chief economist and fixed-income strategist at Janney Montgomery Scott LLC in Philadelphia, who forecast the trade gap would shrink to $31 billion. "We'll see a pickup in imports into the fourth quarter as the U.S. consumer stabilizes. The outlook on the trade front is stable to improving for exports, and a bit challenging for imports" (The Wall Street Journal, Moody's Economy.com and Bloomberg.com Oct. 9) ...

• For the week ending Oct. 2, the Economic Cycle Research Institute (ECRI) Leading Index rose to 128.3 from an unrevised 127.1 the previous week. The smoothed, annualized growth rate increased to 26.1% from a revised 25%--which was previously 25.1%. The current slow recovery likely will continue into at least the first half of next year, ECRI said. Although recovery is in progress, the economy still remains fragile, analysts said. The economy will grow in the third quarter 2009, but will not reach its potential until the second half 2010, ECRI said. It's likely recovery will not turn into expansion until 2011--at which time gross domestic product should surpass its pre-recession peak, analysts said (Moody's Economy.com Oct. 9) ...

• The number of U.S. job openings in August dropped for the third consecutive month to 2.39 million, according to the Job Openings and Labor Turnover Survey (JOLTS) issued by the Bureau of Labor Statistics. Hiring dropped to 4.03 million in the month. The number of separations also declined, to 4.27 million, but still exceeded the number of new hires. The numbers are consonant with other labor market measures that indicate job separations are diminishing, but employers still are too unsure of the economy to resume hiring, analysts said. The August JOLTS data indicate that the labor market still is weakening, they added (Moody's Economy.com Oct. 9) ...

News of the Competition

MADISON, Wis. (10/12/09)

• Wells Fargo & Co., PNC Financial Services Co. and several other big regional U.S. banks are confronting larger credit challenges than their stock prices would indicate, said UBS AG. On Thursday, UBS began coverage of 10 banks with "sell" or "neutral" ratings. In the near term, Well Fargo and PNC face "meaningful" credit problems that will likely result in their not attaining 2010 and 2011 Wall Street earnings forecasts, UBS said. However, not all regional banks are challenged, UBS said, citing BB&T Corp., M&T Bank Corp. and U.S. Bancorp among those with the most robust outlooks (MarketWatch Oct. 8) ...

• Citigroup Inc. has agreed to sell its energy trading business--Phibro LLC--to oil producer Occidental Petroleum Corp. In the aftermath of last year's $45 billion bailout, Citi is shedding assets, analysts said. Occidental said it will pay "net asset value" for Phibro, and expects its "net investment" in Phibro to be roughly $250 million. Citi said the impact of the sale won't be germane to its earnings. Phibro CEO Andrew Hall earned more than $100 million last year through his contract with Citigroup, making the energy trading unit a target of critics citing excessive executive compensation. Hall was on course to earn similar compensation this year (Bloomberg.com Oct. 9) ...

Are there any deals left on new cars?

SANTA MONICA, Calif. (10/12/09)--Although the "Cash for Clunkers" program depleted inventory on some models this summer and prices are up, there are still deals, tax deductions, and hybrid credits available (Edmunds.com Sept. 21).

Deals will be dependent on local inventory, especially for 2009 models. Dealers are making way for 2010 models. If it's a Saturn you're looking for, move quickly. While dealers have until October 2010 to close, many of these cars may be gone by January. Some Saturn models are selling below invoice, according to TrueCar.com, and General Motors (GM) will honor the warranty on new Saturn purchases.

If you live in California, you could consider buying a new car on eBay. GM is testing the selling of new cars on the auction site. This may be a less stressful way to negotiate a deal and help you turn down dealer add-ons.

Wherever you live, look into the federal government's special tax deduction on state and local sales tax paid on a new car purchase up to $49,500. Taxpayers can take the deduction whether or not they itemize when filing 2009 federal income tax returns. The deduction is available to single filers with adjusted incomes of less than $135,000 and joint filers with incomes of less than $260,000.

Federal tax credits are still available for some models of hybrids and vehicles powered by alternative energy fuels such as natural gas and diesel. The credits were originally offered to encourage people to buy fuel-efficient and alternative fuel cars, offsetting some of the extra cost. Consult the Internal Revenue Service rules before you shop.

If you do find a deal this fall, your experience will be much smoother if you make purchasing a vehicle, financing a vehicle, and trading a vehicle three separate transactions. Talk first to a credit union loan officer for a pre-approved vehicle loan and you can shop with confidence.

Resource Links

IRS new car tax deduction rules

IRS list of hybrids qualifying for tax credit

Top 10 Car-Buying Tips statement stuffer

CU Business Group hits $2 billion in MBLs

PORTLAND, Ore. (10/12/09)--CU Business Group (CUBG) announced that it has reached more than $2 billion in member business loans (MBLs) on behalf of credit unions since its inception in 2002.

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"With banks tightening their belts, credit unions are seeing increased volumes in business loan applications, which means a lot of new opportunities," said Larry Middleman, CUBG president/CEO.

Credit union delinquency rates and charge-offs are consistently lower than banks, according to data CUBG compiled from June 30 National Credit Union Administration and Federal Deposit Insurance Corp. data.

Credit union delinquencies were 1.15% for credit unions, compared with 5.59% for banks under $1 billion in assets and 5.32% for all banks. Credit union charge-offs were 0.38%, compared with 0.76% for all banks, and 0.43% for banks with less than $1 billion in assets, the company said.

CUBG works with 315 credit unions in 40 states and underwrites for 164 credit unions. The company is based in Portland, Ore.

Harland Financial Solutions has two new CU services

ATLANTA (10/12/09)--Harland Financial Solutions announced two new service offerings for credit unions--Enterprise Resource Services and Enterprise Optimization Services, which two credit unions have already deployed.

Affinity Plus FCU, St. Paul, Minn., uses Enterprise Resource Services. The service simplified the $1.3 billion asset credit union's maintenance tasks, "freeing our staff to focus on more important projects that truly can benefit our members," said Keith Malbrue, chief operating officer of Affinity Plus (Science Letter Oct. 13).

Enterprise Resource Services provides in-house UltraData Enterprise core processing and allows clients to outsource their credit unions' information technology, operations and business continuity functions. Harland also provides other tasks including system monitoring, database backups and software upgrades.

Los Angeles Police FCU employs Enterprise Optimization Services, which provides onsite analysis of credit union processes, software use and workflow. The technology helped the credit union identify areas for improvement, noted Michele Megill, vice president of operations and communications.

With the service, Harland also can provide credit unions with ongoing reports based on the analyses.