Current Category: Credit Union News

Last year was a record year for deposits at Service One as members moved more than $15M to their credit union. I'm delighted to announce that our assets topped $101,000,000 thereby reaching a historic milestone for our growth. More than 14,500 members do their financial transactions at SOCU. With proposed member-friendly products and plans for 2010, our future looks bright.

ABC features: Switch to CUs

NEW YORK (1/12/10)--The media kudos for credit unions continues this time with ABC's Diane Sawyer Friday noting on ABC's World News Tonight that many consumers are trading their financial institutions on Wall Street to the ones on Main Street.

The ABC news piece, "Switch to CU, Avoid Bank Fees," featured two consumers who switched from their big banks to smaller financial institutions. It also noted the "Move Your Money project," which was created by Arianna Huffington, owner of The Huffington Post. The project encourages consumers to take their money out of big banks and move it to smaller financial institutions such as credit unions and community banks.

"When big banks see real competition from the community banks and credit unions, they will change their behavior," Huffington told ABC's David Muir.

The project's Facebook group, "Move Your Money," has nearly 20,000 fans. The "Move Your Money" campaign on YouTube also has received more than 300,000 views (Newsline Express Jan. 8).

Credit Union National Association President/CEO Dan Mica also wrote a column for The Huffington Post, saying that credit unions are experiencing record membership growth and that "disenchantment" with banks may be part of the reason. His column generated many reader comments, many of them about the positive experiences consumers have had with credit unions.

In other news, The Washington Post Thursday recommended that homeowners looking to refinance a mortgage talk to several lenders--including a credit union.

A blog, the Red, White and Blue Press also recommended (Jan. 11) that consumers seek credit unions instead of banks to improve their finances.

The credit union movement's trade association, CUNA, brings with it an array of smart, industrious, and committed professionals. Their work enhances credit unions ability to serve our membership. Happy Birthday, CUNA.

CUNA celebrates 75th anniversary today

Today the Credit Union National Association (CUNA) is blowing out 75 birthday candles. It was Aug. 10, 1934, when CUNA's Constitution and Bylaws were signed in Estes Park, Colorado, less than two months after the Federal Credit Union Act was signed and 25 years after the nation's first credit union was established.

Supporters of the U.S. credit union movement met at Estes Park, Colo., Aug. 8 -10, 1934 to form a national association--today's Credit Union National Association. Its constitution and bylaws were signed on Aug. 10.

"Seventy-five years ago, an extraordinary group of credit union pioneers held a 'meeting of the minds' in Estes Park, Colorado, about a national association that would enhance the movement throughout the land and help it become self-reliant," said CUNA Pres/CEO Dan Mica.

"Ultimately, 52 delegates from 21 states and the District of Columbia exchanged views in a 'constitutional convention' of sorts. Over four full days, the delegates debated (sometimes in heated terms), cooled off in the mountain air, and debated again," Mica said.

Mica noted that historians wrote years later: "Most of those present felt a deep sense of satisfaction at having at last developed the organizational framework for an association which hopefully would advance the credit union movement to new heights of usefulness and service.

"Today, it is an honor for all of us at CUNA to continue the work set out by those leaders three-quarters of a century ago. Our focus is completely on advancing this great movement to new heights--through leadership, advocacy and services," Mica said.

"Next month, when the CUNA Board meets in Estes Park as a tribute to our organization's founders, all will have 75 years of credit union progress on our minds--and a determination to ensure the next 75 years of progress and prosperity for credit unions," Mica concluded

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Your credit score impacts your life in many ways not readily understood by the average consumer. A good score will make it easier to build wealth by allowing you to obtain less expensive interest rates for homeownership, automobile financing, and the convenience of credit card useage. Often a person's credit score will impact his/her insurance rates and opportunities to invest. This article looks at our economy's influence on the nation's credit scores.

Debt is down, but so are some credit scores

SAN FRANCISCO Credit Union News (7/20/09)--Credit unions may get questions from their members about credit scores, especially if the members have been working off their debt and find their credit score is less than a year ago. While debt for the average American is down, many are seeing lower credit scores.

Credit card companies that tightened their credit available to consumers the past two years have impacted their cardholders' scores, according to a survey by Credit Karma, a San Francisco-based online research and education business.

When a card company reduces the credit card limit and the consumer still uses the card the same as always, the consumer is tapping into a greater percentage of the current available credit than under the older, higher limit. This affects the credit score (BusinessWeek.com July 14 and WalletPop.com July 16).

Credit score bureau Experian says that American's median score at VantageScore --a competitor to the well-known FICO score invented by Fair Isaac--fell eight points in March--down 1% from the year earlier. TransUnion's average TransRisk scroe showed a similar 1% decline in first quarter over first quarter 2008, reported BusinessWeek.com.

In May the average U.S. consumer's credit score was 674, down nearly 20 points since 2007 according to Credit Karma and Experian. In 2007, the average credit score for the first six months was 692. Equifax, however, said that in May the average Equifax Risk Score rose 0.3% from May 2008. It attributes the slight decrease to the fact that Americans are using credit cards less frequently, are paying off balances in full, and are staying current on their payments. These consumers are balancing out the delinquent borrowers.

Roughly 72% of consumers saw their scores improve or stabilize. Nearly 38% of the credit scores rose, while 34% had the same credit score in June that they had the month before. That compares to 32% who had the same credit score in May as they did in April. About 28% of those surveyed saw a decrease in their June credit score.

Credit Karma reported last week that the average consumer credit card debt at the end of June declined by $134 from the first quarter. Based on the credit histories of more than 44,000 of the company's customers, the average consumer with debt had:

$6,938 in credit card debt;
$206,427 in home mortgage loans;
$54,370 in home equity loans;
$14,539 in auto loans; and
$27,201 in student loans.

Midwesterners had the lowest amount of debt.

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This is a new twist on legislative activity! I commend Rep. Paul Kanjorski. So often bad legislation is enacted due to reactive decisions.

Kanjorski: Congress should take time with reg reforms

CUNA NEWS, WASHINGTON (7/2/09)--Congress should "step back" and take time to "analyze the implications and the effects" of the laws and regulations that are being debated before it begins the process of legislating financial regulatory reforms, Rep. Paul Kanjorski (D-Pa.) said in a Wednesday appearance on CNBC.

Commenting on the apparent rush to regulation that is currently being led by some members of Congress, Kanjorski, who chairs the House subcommittee on capital markets, insurance, and government-sponsored enterprises, said that acting in a more deliberate fashion should ultimately "create better standards and a better performance rate.

"If it takes six more months, what does it matter?" Kanjorski asked.

Both Congress and the Obama administration have moved swiftly to begin the regulatory reform process, with the Treasury delivering on Tuesday draft legislation for the creation of the Consumer Financial Protection Agency.

Rep. Barney Frank (D-Mass.), who serves as chair of the House Financial Services Committee, has held several hearings on financial regulatory reforms in recent days, and his committee will continue to discuss this issue once Congress has returned from the Independence Day district work period on Monday. Frank recently suggested that his committee could begin marking up financial regulatory reform legislation late this month, and a full House vote could take place as soon as August.

Overall, Kanjorski said, Congress "will craft the best legislation," but the quality of that legislation does not matter if those tasked with enforcing that regulation are not "properly stimulated to implement good practices."

The U.S.credit union system has been buffetted by the banking crisis this year. Today, the strength and soundness of credit unions was formally recognized by U.S.Treasury officials. Life has been interesting in credit union land this year.

WASHINGTON (6/18/09)—The U.S. Treasury's report on financial regulatory reform, released to the public on Wednesday, would allow the National Credit Union Administration (NCUA) to maintain its safety and soundness authority over credit unions.

Noting that the ongoing economic uncertainty provides an "opportunity for restructuring that will genuinely produce improved regulation," NCUA Chair Michael Fryzel said that the Obama administration's proposal "merits serious consideration." The continued independence of the NCUA and the proposal's plan to create a consumer protection council will "serve to ultimately improve the safe and sound operations of the U.S. financial system," he added.

CUNA Sr VP of Legislative Affairs John Magill said that the report's lack of recommendation for substantive changes in the safety and soundness of regulations for credit unions affirms that "credit unions were not the cause of nor a contributor to the financial crisis."

"I am not sure they could be clearer in their intent that NCUA remain an independent regulator than to say at least twice in the document," Magill said. But he also advised credit unions that the administration's proposal would not be "the last word on regulatory restructuring."

Magill noted, "Congress is going to have its say over the next weeks and months, and we will continue to monitor this very closely."

Ryan Donovan, VP of Legislative Affairs for CUNA, said that the potential consolidation of some existing regulations could reduce costs and lessen the regulatory complexity faced by many credit unions.

To help launch what is sure to be a thorough vetting of the plan's intricacies, the Senate Banking Committee and the House Financial Services Committee have scheduled Treasury Secretary Timothy Geithner to appear before them in separate hearings today to discuss the Obama plan.

American Banker: CUs are 'the mouse that roared'

CUNA NEWS; MADISON, Wis. (6/3/09)--Credit unions' market share for the home loan origination market has grown to the extent that they could be called the industry's "mouse that roared," American Banker said Tuesday.

With the reputation of large financial institutions hurt by aggressive loans that backfired during the real estate market's boom, credit unions have gained more members, the publication said.

Also, credit unions tend to have a better reputation than many lenders in the residential real estate finance business, and--for the most part--follow low-risk strategies, American Banker said.

"People are looking for people they can trust to originate a mortgage," Les Parker, president of Parker & Co., a mortgage advisory firm with clients that include credit unions, told the publication.

Credit unions have some constraints on the their home loan growth such as regulatory and business culture changes they would need to implement to become bigger player in the mortgage business, and because of the nature of their membership paradigm, American Banker said.

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