Life Is A Highway ... March 4, 2010

Association Announces 2010 Lifetime Achievement Award Winners

Bosma-LaMascus, Nyman, Marisic To Be Honored

The Association is pleased to announce the winners of the 2010 Lifetime Achievement Awards.

Peggy Bosma-LaMascus, CEO of Patriot FCU, Chambersburg, has been named the 2010 William W. Pratt Professional of the Year.

In an unprecedented move, two nominees were selected as recipients of the 2010 Joseph A. Moore Volunteer of the Year Award: Paul Nyman, Horizon FCU, Williamsport, and John Marisic (posthumously), Pennsylvania State Employees Credit Union, Harrisburg.

Bosma-LaMascus has been involved in the credit union movement for more than 30 years, and has served as President/CEO of Patriot FCU since 1982. She served on the Association’s Board of Directors from 1987 through 2001, and was a member of various committees, including the Governmental Affairs Committee and PAC Trustees, which she chaired for many years. She also was elected as a CUNA Director from 1993 through 1997; served on the Filene Research Institute Development Committee, 1989-1996; and was a member of the CUNA Environmental Scan Team in 1989.

Nyman has dedicated more than 25 years of volunteer service to credit unions, and has served on the Board of Horizon FCU since 2000. He is actively involved in the Susquehanna Valley Chapter of Credit Unions and various community organizations. He is also a member of the Association’s Governmental Affairs Committee and plays an active role at the grassroots level.

Marisic, who passed away in early January, most recently served as Vice Chairman of the Board of PSECU, and had been involved with the credit union for more than 30 years. He was a frequent attendee of the CUNA Governmental Affairs Conference, and was an active participant in the push for passage of H.R. 1151, the Credit Union Membership Access Act. He worked tirelessly as an advocate to support credit union legislative priorities at the state and national level. He was a member of the Association’s Governmental Affairs Committee from 2003-2009.

These prestigious awards will be presented during the closing banquet of the Association’s 76th Annual Convention, Tuesday evening, May 18, in Atlantic City, New Jersey.

Learn more about the recipients of the Lifetime Achievement Awards in this week's Keystone Extra.

PaCUSC Election Results

Congratulations to incumbent Jim Kanaley of Tobyhanna Army Depot FCU, Scranton, who was re-elected to the PaCUSC Board.

His new term begins at the close of the PaCUSC Shareholder meeting in May.

PaCUSC helps credit unions in Pennsylvania and Delaware join the shared branching network that is offered nationwide.

Rep. Kanjorski Suggests Car Dealer Try Credit Unions For Loan

An article in Wednesday’s Citizens Voice tells how a local car dealership received a loan from Cross Valley FCU, after telling Congressman Paul Kanjorski that they were denied credit from banks. Kanjorski suggested to the company president that credit unions could be a possible funding source. 

The article goes on to explain the bill Kanjorski introduced, H.R. 3380, the Promoting Lending to America's Small Business Act, which would enable credit unions to make more small business loans.

“Too many small businesses are hurting because banks are either unable or unwilling to lend to them,” Kanjorski said. “Credit unions, however, lent wisely before the crisis and are now lending even more. While credit union business lending grew by more than 11 percent in 2009, many credit unions are now bumping up against an arbitrary statutory cap. To fill a void in business lending, credit unions need our help.”

By allowing credit unions to increase their member business lending, Kanjorski said it would stimulate economic growth and create jobs.
Citizens Voice Article   

Invest In America Expands Product Offer

Invest in America continues to evolve and new for 2010, credit unions will now be able to share in the marketing revenue generated from each sale in the program. You can now select which programs you want to support, as well as determine the level of commitment and income sharing that fits your credit union’s objectives and goals.

To learn more about the expanding line of products and services offered by Invest In America, join us on Tuesday, March 16, for a preview of what’s new, the variety of savings programs you are able to offer your members, and the potential revenue streams for your credit union. Click here.

MBL Portfolio Risk Management Roundtable

The Association’s Business Advisory Services will offer a four-hour informational and networking session designed to provide participants with an overview of the challenges and successes of your peers in managing their MBL portfolios in today’s unprecedented economy on April 8, 2010. 

Hear risk mitigation tips and procedures from your peer credit union staffers at our MBL Portfolio Risk Management Roundtable. Learn about specific changes credit union leaders from PA and MD have made in addressing credit quality at loan origination and on-going through the life of their loans. Learn what they do to mitigate risk portfolio wide and on a loan by loan basis. 

Topics to be covered during the open forum include:

• Internal Business Lending Department Structure/Responsibilities
• Lending Policy Management
• Handling Problem Loans and Managing the Loan Loss Reserve
• Regulatory Pressures
• Reports to Management/Loan Portfolio Monitoring
• Loan Pricing and ALM
• Credit Union Business Lending Future Predictions

Share ideas, ask questions, and network at this brand new event! For more information, contact Molly Snody, Director of Business Advisory Services, at 800-932-0661, ext. 5209, or molly.snody@pcua.coop.

Education & Training

CEO Leadership Workshop

March 24, Lancaster
March 25, Monroeville

Join your peers at the Association-sponsored CEO Leadership Workshop and discover what steps you must take today to be ready for tomorrow’s challenges.

The CEO Leadership Workshop is open to all credit unions, but is specifically designed for chief executives of small to mid-sized credit unions (less than $90 million in assets).

Topics include: Regulatory Update and NCUA Hot Topics, Asset-Liability Management, and a special focus on Generation Y. Discover the needs and wants of this important market as 2009 Credit Union Youth Ambassador Laura Huggins leads a focus group with members of Generation Y. The day will wrap up with an interactive brainstorming and strategy session.

Registration fee is $159 per attendee ($129 for credit unions under $20 million). For more information or to register, click here.

Chapter News

Chapter News

A BSA Training was held on Tuesday evening, March 2, for 164 people representing 16 credit unions in the Beaver Valley Chapter. Joanne Broderick, Association Compliance & Operations Officer, conducted the 90-minute program, which covered BSA History, BSA/AML program components, CTR/SAR forms and scenarios, FinCEN enforcement actions, CIP-OFAC, and best practices guidance.

National News

National News

Flood insurance, SBA programs extended to March 28

WASHINGTON (3/4/10)--Funding for the National Flood Insurance Program, Stimulus Act small business loan guarantee programs, federal unemployment insurance, COBRA benefits, and other select federal programs was temporarily extended when President Obama signed H.R. 4691, the "Temporary Extension Act of 2010."

The legislation extends funding for flood insurance and small business provisions through March 28th. However, the legislation does not contain longer-term solutions to these issues.

Under the legislation, the Small Business Administration will be provided $60 million in funding until March 28. The legislation also extends some fee reductions and eliminations associated with the small business loan programs contained in the Stimulus Act.

While the House passed similar legislation last week, these and other federal programs expired last Sunday due to inactivity on the part of the Senate.

H.R. 4213, which would extend flood insurance and small business provisions through the end of 2010, is awaiting a vote, and could be voted on this week.

CUs' asset quality deteriorating

MADISON, Wis. (3/4/10)--Credit union asset quality continued to deteriorate in January, with the delinquency rate rising six basis points to 1.92% from year-end 2009, according to a Credit Union National Association (CUNA) economist's analysis of CUNA's monthly review of credit unions for January.

"The last time credit union loan delinquency rates were this high, Ronald Reagan was president," Steve Rick, CUNA senior economist, told News Now. "Over the recent business cycle, credit union delinquency rates reached their nadir in April 2006 with a reading of 0.53%.

"Credit unions should expect loan delinquency rates to rise further over the next few months," Rick added. "Expect job creation to be weak for the next six months because firms are still reluctant to bring on new workers during this time of great economic and government-economic-policy uncertainty. In other words, firms are having a hard time determining the marginal benefit and marginal cost of an additional worker."

The rise in long-term unemployment is a serious concern for credit unions' asset quality, Rick said.

"There are currently more than six million people who have been unemployed for more than six months, up from one million two years ago," he explained. "And the number is still rising. Many long-term unemployed are facing severe financial difficulties with little hope of landing a job anytime soon."

Credit union loans outstanding decreased 0.5% during January, down from a 0.3% increase during January 2009. Fixed-rate mortgages led loan growth, rising 0.4%, while used-auto loans and home equity loans each declined 0.1%. Unsecured personal loans dropped 0.5%, followed by other mortgages (0.9%) and new-auto loans (1.5%). Credit card loans also decreased 1.5%, and adjustable-rate mortgages fell 1.9%.

"Credit union loan balances fell for the third consecutive month in January," Rick said. "Weak loan demand on the part of members and loan sales on the part of credit unions is responsible for the remarkably low 0.2% growth in loan balances over the last year."

Credit union savings balances decreased 0.4%, down from a 1.7% increase during January 2009. Money market accounts rose by 1.5%, followed by regular shares, which increased less than 0.1%. Individual retirement accounts declined 0.8%, followed by one-year certificates and share drafts, which dropped 1.1% and 2.7%, respectively.

The loan-to-savings ratio remained at 76%. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--stayed at 19%.

The movement's overall capital-to-asset ratio in January remained at 10%. The total dollar amount of capital is $90 billion.
Monthly CU Data

Fed plan would shield card users from penalties, fees

WASHINGTON (3/4/10)--The Federal Reserve (Fed) has proposed amending Regulation Z "to protect credit card users from unreasonable late payment and other penalty fees and to require credit card issuers to reconsider increases in interest rates."

The proposed rule is the third portion of the Fed's phased implementation of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009. These portions of the CARD Act will become effective on Aug. 22.

In a release announcing the potential changes, Fed Governor Elizabeth Duke said that the proposal "addresses two key costs of using a credit card--fees and interest rates."

The rule, if approved, "would prevent credit card issuers from charging large penalty fees for small missteps by consumers and would require issuers to reevaluate rate increases imposed since the beginning of last year," she added.

Specifically, the proposal would prevent card issuers from charging late payment and over limit fees in excess of the amount of the purchase which triggered the fee. Inactivity fees and, in some cases, multiple penalty fees would also be prevented under the proposal.

Credit issuers would also be required to "inform consumers of the reasons for increases in rates" and "evaluate" any rate increases made since Jan. 2009. These rates could then potentially be reduced.

The proposal will remain open for comment for thirty days after it is published in the Federal Register.

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