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CURRENT Newsletter | 20 February 2014

Feb 20, 2014 by Lewis Wood

News and Information For and About Virginia's Credit Union System

Headline News

News About Credit Unions

Financial Services/Marketplace News

Education & Networking Opportunities

News From Credit Unions

Chapter News

Financial Education News

Community Involvement

News About The Competition

Headline News

Camp Says Tax Discussion Draft Will be Out Next Week

House Ways and Means Committee Chairman Dave Camp (R-Mich.), in a memo to Republican committee members, said he plans to release draft reforms to the U.S. tax code the week of Feb. 24 ( Bloomberg BNA, Politico Feb. 19). The Credit Union National Association will have 4,300 credit union advocates hitting Washington, D.C., for its Governmental Affairs Conference (GAC) starting Feb. 23 and Executive Vice President John Magill said earlier this week that the timing of having thousands of credit union advocates available for Capitol Hill meetings could not be any better.

In response to news of the Camp memo Wednesday, CUNA President/CEO Bill Cheney said, "For the past nine months, CUNA, the state credit union leagues, and credit unions have been contacting members of Congress and urging them 'Don't Tax My Credit Union.' After more than 1.3 million contacts with lawmakers through that campaign, we're hopeful that our advocacy message got through."

[read more]

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CUNA Launches Action Center on Risk-Based Capital Proposal; CUs Can Voice Concerns to NCUA

The National Credit Union Administration is seeking comments on a proposal regarding risk based capital (RBC) requirements under its prompt corrective action rules. This is easily the most important proposal that NCUA has released in years. The Credit Union National Association's analysis shows that, if implemented, it would lead to credit unions needing to hold as much as $7.3 billion in additional capital.

Even more concerning: We're talking about a multi-billion price tag of additional capital for a system that withstood, under the current system, the worst financial crisis in 80 years. Today, CUNA launched its “Risk Based Capital Action Center” at www.cuna.org/riskbasedcapital

Based on the same grassroots ideas implemented in the Don’t Tax My Credit Union campaign, but retooled for a regulatory focus, we are hoping to use this site to encourage NCUA to fix the proposal. 

[learn more]

[related: NCUA Answers Call for Risk-Based Capital Hearings]

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Slate of Candidates for League Board Positions Announced; Ballots to Be Sent to CUs March 3

The League Governance Committee is presenting the following slate of candidates for League Board positions. Voting is by mail ballot, which will be distributed to credit unions on March 3. Results of the voting will be announced at the League Annual Meeting on April 4.

The slate of candidates put forward is as follows: 

  • Region II Director from a credit union $50 million or more – Chris Williams (Henrico Federal Credit Union). Mr. Williams is the incumbent and his name was submitted by his credit union.
  • Region II Director from a credit less than $50 million – Catherine McDermott (RiverTrace Federal Credit Union). Ms. McDermott was recruited by the committee.
  • Region III Director from a credit union less than $50 million – Dan Morrisey (Queen of Peace Federal Credit Union). Mr. Morrisey was recruited by the committee.
  • At-Large Directors (two) – Rose Gilliam (Argent Credit Union) and Gaye DeCesare (Belvoir Federal Credit Union).  Ms. Gilliam and Ms. DeCesare are incumbents and their names were submitted by their respective credit unions.

[learn more]

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CUNA, CBA: CUs, Banks to Absorb More Than $200M in Target Breach Costs

The cost of the Target data security breach has topped $200 million for credit unions and Consumer Bankers Association member banks combined, according to numbers released by the Credit Union National Association and the CBA. Last week, CUNA refreshed numbers from its survey that found the breach has cost credit unions $30.6 million.

CBA estimated its member banks have incurred more than $172 million in costs because of the retail giant's data breach. Credit unions and CBA members have replaced 21.8 million cards--more than half of the total of all compromised cards. [read more]

[related: CUNA, CBA Target Breach Numbers Grab Media's Attention]

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Aid Our Advocacy Mission: Report Your Micro-Lending Initiatives

Credit unions: We're again collecting your micro-loan data through our Reality Check survey. We're asking you to report information on loans you've made of $3,000 or less, excluding credit cards, for Calendar Year 2013. Please give us a hand and provide this data, which we use to support our advocacy efforts o your behalf! Report your aggregate micro-loan data at this web address (short seven-question survey!): Online Survey.

We would also love to share your stories about members helped by your small loans. Photos of the members you've helped would also be appreciated! Email them to pr@vacul.org
>> We have a downloadable version of the survey as well! (PDF, 267kb)

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Report Your Good Works and Aid Our Advocacy Efforts; Community Involvement Survey Online

Credit unions have a long and storied history of service through charitable giving and through projects that better our communities. Help us report your good works by completing the Community Involvement Committee's annual survey, located here: http://www.surveymonkey.com/s/community-involvement13.

By reporting your efforts, you are helping us show lawmakers and the media one more way we "earn" our tax exemption. So please help us tell this important story. Once you gather your survey data, completion of the survey itself should take no more than 5 minutes. Thank you, in advance, for helping us be a more effective advocate on your behalf.

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News About Credit Unions

America’s Credit Unions Sponsor 2014 USA Women’s and Men’s 10 Mile Championship Hosted by the Credit Union Cherry Blossom Ten Mile Run

Credit Union Miracle Day, the sponsor group of a Family of Races, in cooperation with Credit Union National Association, has secured the presenting sponsor rights by USA Track & Field to the USA Women’s and Men’s 10 Mile Championships to be held at the Credit Union Cherry Blossom Ten Mile Run in Washington, D.C. on April 6, 2014.

The championships, which will feature many of America’s finest distance runners, will be designed as being presented by America’s Credit Unions.  

“We are delighted to be connected with this nationally recognized women’s and men’s sporting competition,” said Charlie Mallon, President/CEO of Congressional Federal Credit Union and Chairman of the Credit Union Race Committee for the Credit Union Cherry Blossom Ten Mile Run. “This designation elevates not only this world-class running event, it also raises awareness of credit unions’ commitment to serving their 98.9 member-owners and communities.”

[read more]

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Growing Investments Means Embracing Gen X, Gen Y Now

A tremendous amount of wealth is going to change hands through inheritance in the next 10 years, and the indicators are not good that credit unions will retain this wealth unless they start actively engaging Generation X and Generation Y now, attendees of CUNA Brokerage Service, Inc.’s (CBSI) FOCUS Conference were told Monday.

David Polet, CUNA Mutual Group’s Voice of Customer director, and Gary Weuve, CBSI’s Center for Advisor Excellence vice president and author of “Close More Sales in Financial Institutions: 12 Keys to Success,” told a FOCUS advisor workshop session that credit unions have been steadily losing younger people, so the pipeline for their future personal investments is getting smaller while the competition for their money is greater.

[read more]

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CUNA Mutual Group Posts Earnings Growth in 2013

CUNA Mutual Group’s strong operating results in its core credit union business led to the company’s earnings growth in 2013, as consolidated Generally Accepted Accounting Principles (GAAP) operating revenue and net income increased over 2012. CUNA Mutual Group recorded $162 million of net income (GAAP) in 2013, compared to $150 million in 2012. 

[read more]

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Financial Services/Marketplace News

Fewest Americans in Almost Two Years Say U.S. Economy Worsening

The share of consumers expecting the economy to worsen fell in February to an almost two-year low as Americans looked beyond harsh winter weather.

Thirty percent, the fewest since May 2012, said the economy was headed in the wrong direction, data from the Bloomberg Consumer Comfort Index showed today. The gap between positive and negative expectations was minus 3, an eight-month high.

The weekly measure was little changed at minus 30.6 for the period ended Feb. 16 from minus 30.7. Snowstorms and colder temperatures in the eastern U.S. last week that shuttered government offices, stalled highway traffic and canceled flights did little to dismay Americans about the economic outlook.

[read more]

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Delinquent Auto Loans Drop: Experian

Credit unions and other lenders are seeing a decrease in delinquent auto loans. According to Experian Automotive’s State of the Automotive Finance Market report released Wednesday, 30-day automotive loan delinquencies decreased from 2.72% in the fourth quarter 2012 to 2.63% in the fourth quarter of 2013, while 60-day auto loan delinquencies remained flat at 0.74%. The percentage of loan dollars that were 30 days delinquent rose just slightly from 2.22% in Q4 2012 to 2.26% in Q4 2013.

The percentage of loan dollars that were 60 days delinquent rose slightly from 0.55% during the same period. Experian said the average chargeoff amount for auto loans gone bad jumped from $7,277 in Q4 2012 to $8,520 in Q4 2013. However, the report also showed outstanding automotive loan balances increased 11% from Q4 2012, reaching $798.5 billion in Q4 2013, which is the highest level since Experian Automotive starting publically reporting the data in 2007, the firm noted.

[read more]

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Education & Networking Opportunities

Annual Meeting 2014 Early-Bird Registration Underway

We're celebrating our 80th anniversary in grand style! Your League's 80th Annual Meeting is April 2-4, 2014, in Williamsburg. With 20-plus education sessions, keynotes from former CNBC economist Marci Rossell and Andy Janning, a former credit union exec-turned-professional speaker and motivator, plus a half-dozen networking opportunities, you can't afford to miss it! Register now and save $50 off regular registration costs and take advantage of deep discounts at our host hotel, The Williamsburg Lodge.

[learn more]

News From Credit Unions

Langley Federal Credit Union Donates $10,000 to Support New Adult Day Services Program

Langley Federal Credit Union presented a check in the amount of $10,000 to the Colonial Heritage Community Foundation (CHCF) for support of their Innovative Senior Champions Program (ISCP).

The donation allows the CHCF to develop the adult day services program and related services for the aging population in the Greater Williamsburg area. The ISCP would include areas such as art, music therapy, therapeutic gardening and health and wellness.

[read more]

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Chapter News

Tidewater Chapter to Host March 15 Workshop

All credit unions are invited to attend the Tidewater Chapter's March 15 Workshop in Norfolk. On tap are education sessions covering subprime lending, the NCUA's IT exam basics, teaching personal finance to young people, an update on EMV and the evolving world of payments, board member duties, and much more.

Location: Old Dominion University campus.

Time: Registration begins at 2 p.m.; dinner and door prizes will wrap up about 7:30 p.m.

Educational Investment: $75 per person until Feb. 28; $85 thereafter.

[Download the brochure here]
[Vendors/Business Partners: Be a Part of This Exciting Event! Learn more here

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Financial Education News

CUs Invited to Hold a Casual Day on April 2 to Raise Funds for Financial Ed Efforts

The National Credit Union Foundation (NCUF) is inviting credit union organizations to hold a “Financial Fitness Day” fundraiser on April 2, 2014 to kick off National Financial Literacy Month. This initiative will raise funds for NCUF and state credit union foundations in support of their financial education initiatives. To participate, credit union organizations can hold one (or more) of the following fundraisers on April 2:

  • Jeans or Casual Day for staff
  • Bake Sale for staff and/or members
  • Deduct or Donate a Buck - Ask staff and/or members to consider a voluntary contribution of $1 or more either in cash as they complete their transaction and/or deducting from their checking or saving account as often as they choose.

[read more]

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Community Involvement

We Need Your Help: League Community Involvement Committee Seeks Financial Contributions for Annual Meeting Fundraiser

Please consider a financial contribution to aid us in purchasing items for our Charity Raffle (we're calling it the "Raffle-A-Rama") which will take place at this year's Annual Meeting (April 2-4 in Williamsburg). What We Need...

  • Chapters: We're asking for a financial contribution of not less than $250.
  • Credit Unions ($100 million or more in assets): Please consider a financial contribution of at least $250.
  • Credit Unions (Less than $100 million in assets): Please consider a financial contribution of at least $50.

[read more]

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News About The Competition

Do Banks Have a Future in Small-Dollar Credit?

Consumer advocates derided it as a "bank payday loan," while its sellers preferred the more neutral-sounding term "deposit advance." Whatever name goes on its tombstone, the product's funeral was unceremonious. Over a weeklong stretch last month, all six institutions that offered the controversial credit product — they range in size from megabank to community bank — quietly announced plans to pull the plug.

Pressure from federal banking regulators made the business untenable. Yet four of the banks — U.S. Bancorp (USB), Regions Financial (RF), Fifth Third Bancorp (FITB) and BOK Financial (BOKF) — pledged to develop new small-dollar loan options for customers who previously used the deposit advance. The coming months will demonstrate just how hard those banks, and others that have been watching from the sidelines, are willing to fight for borrowers with low incomes and poor credit profiles.

Will banks put substantial resources behind their loan offerings in an effort to compete with payday lenders, auto title lenders and other high-priced sources of small-dollar credit? Or will they unenthusiastically introduce new products simply to assuage their regulators? (American Banker Online, Feb. 20)

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