LSCU eSignal Weekly
LSCU eNews Weekly April 1, 2013
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LSCU eNews Weekly
In This Issue
President's Point
Walmart threat is real for credit unions
LSCU Top Headlines
This week's top League headlines
Governmental Affairs News
This week in Alabama politics: legislature reconvenes this week
This week in Florida politics: foreclosure bill status, unemployment rate drops, and more
Washington Update: banks jittery over Sen. Johnson's retirement
Grassroots expert to share insights at Alabama State GAC
Florida State GAC video posted
Compliance Corner
League InfoSight highlight: CFPB looking at indirect auto lending
Fair lending examination program and free compliance assistance
CUNA Regulatory Advocacy Report - Week of April 1
Compliance calendar and training
Communications News
An hour of your time to recognize worthy CUs and CU professionals - LSCU/CUNA Awards
Education News
Upcoming webinar on frontline compliance
Cooperative Initiatives News
LSCU debuts Credit Union Certified Financial Counselor Training (FiCEP)
Financially fit day Wednesday April 3
LEVERAGE News
LEVERAGE partner to hold credit union forum
Regulatory briefing webinar offered by ComplyTrac engine
News from You
First Commerce Credit Union awards $2,000 to the Foundation for Leon County Schools
Alabama Telco announces recent appointments
EMPLOYMENT
View available credit union jobs
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President's Point

Walmart threat is real for credit unions

Credit unions have felt many threats in the 75 plus years that they have been in existence. Banks are continually fighting credit unions whenever they want to expand their product and services to better meet the evolving needs of their members. We see this daily in Montgomery, Tallahassee, and Washington, D.C. But there is a bigger threat that could have significant implications for credit unions and banks and that threat is Walmart.

The world’s largest retailer has been trying to get a foothold in financial services for quite some time. Walmart was not able to secure an industrial bank charter back in 2007 (it should be noted they did subsequently get bank charters in Canada and Mexico), so the retailer has been looking for ways to provide its customers with banking-like products first through its Money Centers which have popped up in many of its store locations and now with the introduction of its Bluebird prepaid debit card, which was granted FDIC insurance this past week.  

The Independent Community Bankers of America blasted the FDIC backed cards by saying they are basically checking accounts in prepaid clothing. The Bluebird card debuted in October 2012 and is generated through American Express. The FDIC backing came after American Express changed its position to allow government funds to be deposited on the cards. These funds can only be deposited into accounts that carry FDIC or NCUA insurance. The FDIC backing is made possible through an agreement between American Express and Wells Fargo.

The community bankers have vowed to fight this latest move by Walmart and American Express. The bankers have been talking to the CFPB who is working on a proposed rule for prepaid cards. In the meantime, go into any Walmart store and you will find the Bluebird card kiosk right near the entrance. This is a major threat to credit unions because more than 30 percent of Alabama and Florida residents are considered unbanked or under banked. You see many of these residents using prepaid cards from Walmart or getting their checks cashed at the Walmart Money Center and paying bills. They are doing banking at Walmart, yet the retailer is not regulated like other financial service providers and therefore does not have to comply with the array of regulations that credit unions and banks must follow. Think what type of innovation your credit union could do if the shackles of regulation and compliance were removed?

The Bluebird card is one of the main articles in the first-quarter edition of Signal Magazine. It should be at your credit union soon. Read the article and do some research on the Bluebird card. Walmart’s retail sales are greater than the next five largest retailers combined. They have more than 4,000 stores in the U.S. Walmart is a major player politically both in Washington D.C., as well as in state capitols. Walmart led the retailers fight to get interchange fees reduced two years ago. The credit union industry needs to find an alternative solution to compete with Walmart’s Money Centers and the Bluebird card before it is too late. 

Where’s Patrick:  This will be a long week for me. On Monday, I will be in Atlanta for the NCUA Region III League President’s Meetings. On Tuesday and Wednesday I will be in Tallahassee for management meetings and our Quarterly League Update webinar. On Thursday, I fly to Washington, D.C. for meetings with NCUA and to participate in the annual Credit Union Miracle Day run. On Sunday, I fly into Birmingham. You can see my schedule for the next two weeks by clicking on “Where’s Patrick?” 

Send me any feedback to this column.
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LSCU Top Headlines
This week's top League headlines

Southeastern credit unions add $3 billion in assets in 2012
Looking back on 2012, credit unions in Alabama and Florida added more than $3 billion in assets, while seeing positive lending numbers for the first time in three years. Member business loans also grew last year. A great way to show the success of credit unions in both states is that each added more than 150 full-time employees last year. Read more by visiting the LSCU Top Stories.

Corporate assessment range falls $900 million
The NCUA announced that the top end range for the Temporary Corporate Credit Union Stabilization Fund has declined $900 million. The range for assessments is now between $1.6 billion and $3.9 billion. The range had been between $1.9 billion and $4.8 billion six months ago. The assessments are still projected to between eight and 11 basis points for 2013. The NCUA board will vote on the assessment this summer. Read more in the LSCU Top Stories.  

League quarterly webinar is April 3
The LSCU Quarterly League Update webinar is Wednesday, April 3 at 3pm EST/2 pm CDT. The webinar is a great way to stay up-to-date on the priorities of the League and what staff is doing on your behalf. Credit unions are encouraged to attend the one-hour webinar and provide feedback. Register for the webinar by clicking here.

NCUA gets clean audit on NCUSIF
The NCUA announced last week that KPMG has given the Temporary Corporate Stabilization Fund a clean audit. KPMG announced that there were no reportable findings. This is the third straight year that the fund has been given a positive audit. Read more by visiting the NCUA website.
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Governmental Affairs News
This week in Alabama politics: legislature reconvenes this week

The Alabama Legislature reconvenes April 2 to begin the second half of the 2013 legislative session. The legislature took last week off for its annual “spring break” and what some deem as cooling off period. The first half of the session went as expected with the majority of the Republican agenda being passed and sent to the governor’s desk or being advanced through the process. There were a few hiccups along the way, but nothing the leadership could not work its way around. The major controversy came when both houses approved the Alabama Accountability Act, paving the way for children to transfer from failing schools to other non-failing schools or private schools. The effects of the passage of the legislation were felt for the past three weeks in the House and Senate. The House crawled along, only passing two bills a day for seven legislative days and the Senate was able to pass a few non-controversial bills.

Going forward, the slow-down is not predicted to let up at any time in the near future and both budgets still need to be passed. The Education Trust Fund will be in committee this week and the General Fund Budget has passed the Senate and is awaiting House action. The House will convene Tuesday at 1 pm and the Senate 30 minutes later.

Follow the GA team legislative updates on Twitter and Facebook.

For questions regarding legislative affairs issues in Alabama, contact LSCU Director, Governmental Affairs - Alabama Jason Cochran at 866.231.0545, ext. 2159.
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This week in Florida politics: foreclosure bill status, unemployment rate drops, and more

The Latest on the Foreclosure Bill Moving Through the House and Senate
The average foreclosure takes 853 days to make it through the court system in Florida, and lawmakers have responded by pushing a bill to expedite the process. Consumer advocates, foreclosure attorneys, and homeowners in foreclosure have spoken out against those efforts, saying the legislation tramples over due process. Rep. Kathleen Passidomo (R-Naples) and Sen. Jack Latvala (R-Clearwater) are trying again with HB 87 and SB 1666, respectively, to speed up the foreclosure process but impose more requirements on banks and lenders to prove they own a loan for the property before foreclosing on it. Lawmakers are also grappling with how to spend $200 million from a multistate foreclosure fraud settlement with five large banks. Florida’s take of the $25 billion settlement was $8.4 billion. Most of the money is going to loan modifications and principle reductions, but lawmakers are still hashing out how to spend part of the civil penalty awarded to the state. The House and the Senate have unveiled their plans to spend the $200 million in foreclosure settlement funds, revealing a marked difference in their approaches. The House wants to spend $45 million for down payment assistance, which is not funded by the Senate, and the upper chamber wants to use $65 million for the SHIP program, which is not in the House plan. You can find more details here.

Florida's jobless rate dips to 7.7 percent in February
Florida’s unemployment rate dropped to 7.7 percent in February, according to numbers released Friday by the Department of Economic Opportunity. That is 0.2 percent lower than January and the lowest monthly rate since October 2008, when the jobless rate was 7.4 percent. The state added 7,800 jobs this past month, an increase of 0.1 percent for the month. But there have been 128,100 jobs added in the past 12 months, a job growth rate of 1.7 percent, beating the national average of 1.5 percent over the same period.

Scott Shuts Down Lieutenant Governor's Office
Gov. Rick Scott is shutting down the lieutenant governor's office for now. Former Lt. Gov. Jennifer Carroll resigned this month after she was interviewed as part of an ongoing investigation into an alleged widespread gambling ring; she has not been accused of any wrongdoing. Part of the fallout is the decision to shutter the office until a successor is picked, putting the four employees who remained out of work. Emails show that orders have already gone out to pack up the office and secure state-owned computers, with some employees already circulating résumés. A spokeswoman for Gov. Scott said the decision was made to save money until a new lieutenant governor is appointed and he has repeatedly said that he will not focus on finding a replacement until after the annual legislative session ends in early May.

To read the full Florida Weekly Legislative Update click here.

If you have any questions on any of the legislative issues mentioned above contact LSCU Director, Legislative Affairs, Jennifer Martin, 866.231.0545 ext. 1150. Get in on the conversation and get developing news and legislation updates from GA on Twitter and Facebook.

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Washington Update: banks jittery over Sen. Johnson's retirement

The House and the Senate remain home in their districts for a second consecutive week, this week focusing on constituent outreach. Both chambers will return to Washington next week to continue committee meetings and hearing bills on the floor.

Banks Jittery Over Sen. Johnson Retirement

Last Tuesday, Senate Banking Committee Chairman Tim Johnson (D-SD) announced that he will not run for re-election when his current Senate term expires in 2014. The news gave rise to reports that big banks are panicked at the prospect of Sen. Sherrod Brown (D-OH) taking over as chairman, if Sen. Jack Reed (D-RI), who is next in line based on seniority, opts to chair another committee instead. Big banks are jittery over Sen. Brown's potential chairmanship because Brown has favored breaking up the big banks as a way to prevent future financial crises.

The banks may be panicked. Credit unions are not. The League believes credit unions are well positioned whether the next chairman is Sens. Reed, Brown, Charles Schumer (D-NY) or, should the GOP regain Senate control, Sen. Mike Crapo (R-ID), now the committee’s senior Republican. All have been friendly toward credit unions and sympathetic to the regulatory burdens confronted by smaller financial institutions.

In fact, Sens. Johnson and Crapo introduced an amendment to prevent Fannie Mae and Freddie Mac’s guarantee fees from being used to offset the costs of unrelated policies that increase the federal deficit. CUNA this week sent a joint letter with other financial and real estate trade groups in support. We stressed these fees should be used only for their stated purpose—managing the GSEs’ credit risk.

Free Checking, the Media, and Our New Strategic Vision
Bankrate.com’s free checking survey continues to draw strong press coverage: CNN, The New York Times, NPR, and Kiplinger Personal Finance, among others. Looking at the 50 largest CUs and banks, Bankrate found 72 percent of credit unions still offer free checking, compared to only 39 percent of banks. The wide gap in CUs’ favor and media attention advance two key goals of CUNA’s new strategic vision: raising awareness and fostering service excellence.

The Bankrate survey, summarized here, also gives you an opening to talk to your local media about your credit union’s checking program. Part of our vision is to get to 50 million credit union PFI members in 10 years, up from 40 million today. Checking accounts, as you know, are central to a PFI relationship. So this kind of media coverage is especially helpful on that front.

CUNA has a full list of actions your credit union can take in support of this shared vision (“Americans choose credit unions as their best financial partner”) on their UniteForGood.org web site.

Contact LSCU VP, Governmental Affairs Jared Ross at 866.231.0545 ext. 1012 with any questions.
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Grassroots expert to share insights at Alabama State GAC

The 2013 LSCU Alabama State Governmental Affairs Conference, in Montgomery on April 9-10 at the Embassy Suites Hotel, offers credit unions an opportunity to go deeper into the issues facing credit unions while also building relationships with state lawmakers. This is one of the most important advocacy events for credit unions.

Grassroots advocacy is a major part of how credit unions can make a difference with lawmakers. The State GAC will feature Dr. Joe Perkins. His more than 30-years experience has helped him manage more political campaigns in the southeast than any other individual. Dr. Perkins will give his insights on PAC fundraising and grassroots advocacy. Alabama credit unions will benefit from his stories along the trail and the successes he's had over the years. 

Location & Hotel Accommodations:
Embassy Suites Montgomery Hotel & Conference Center
300 Tallapoosa Street
Montgomery, Alabama 36104
800.362.2779

Registration Fee: $99/person

Visit the LSCU Events Calendar for more information and to register. 

The April 9 lawmaker reception is sponsored by Print Resources.  [ Return to Top ]

Florida State GAC video posted

The Florida State GAC wrap-up video looks closer at CFO Jeff Atwater's statement that he believes credit unions should be able to accept public deposits. LSCU VP, Governmental Affairs Jared Ross tells what that endorsement means to efforts to get legislation passed. 

The video also goes inside the legislative office visits as credit unions discussed public deposits and the credit union tax exemption. Rep. Jason Brodeur (R-Sanford) was awarded the LSCU Lawmaker of the Year and he tells why credit unions are important to the financial landscape in Florida. 

Visit the LSCU Video Room to watch the video. You can also share it with staff and your volunteers. Be sure to share on your social media channels. Contact LSCU VP, Communications Mike Bridges if you have trouble accessing the video.


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Compliance Corner
League InfoSight highlight: CFPB looking at indirect auto lending

The CFPB has let indirect auto lenders know that their compliance responsibilities will fall under the Equal Credit Opportunity Act (ECOA).

ECOA makes it illegal for a creditor to discriminate in any aspect of a credit transaction on prohibited bases including race, color, religion, national origin, sex, marital status, and age. The CFPB has authority to examine large banks, and credit unions--and their affiliates--with more than $10 billion in assets.

According to the CFPB, Indirect auto lenders often allow auto dealers to mark up the interest rates that are offered to consumers, and lenders may then share part of the revenue from that increased interest rate with the dealer. These markups can generate compensation for dealers, and give dealers the discretion to charge different rates to different consumers, without taking their creditworthiness into account. Lender policies that provide dealers with this type of discretion increase the risk of pricing disparities among consumers based on race, national origin, and potentially other prohibited bases.

To ensure they are in compliance with fair lending regulations, the CFPB recommended that indirect lenders:

  • Impose dealer markup controls or revise dealer markup policies
  • Monitor and address the effects of markup policies as part of a robust fair lending compliance program
  • Eliminate dealer discretion to markup buy rates, and fairly compensating dealers using a different mechanism that does not result in discrimination, such as flat fees per transaction.

The current issues of the InfoSight eNewsletter for Alabama and Florida are now available on the InfoSight homepage in the left-hand column. Members must login to the League website with username and password in order to access InfoSight. After you are logged in to www.lscu.coop, click on the InfoSight tab. If you do not have access to the League website, click here to sign up.

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Fair lending examination program and free compliance assistance

According to NCUA Letter to Federal Credit Unions 13-FCU-02, NCUA will select a number of federal credit unions to undergo a fair lending examination this year.

NCUA OCP will host a free fair lending webinar on Thursday, April 4, 2013, from 1:00 p.m. to 2:30 p.m. Eastern Time. The webinar will provide an overview of NCUA's 2013 fair lending examination program, including: how the fair lending off-site supervision contact process works; fair lending tips and best practices that credit unions should consider; and questions and answers.

Click here to register for the free webinar. Participants may submit questions in advance at WebinarQuestions@ncua.gov (the subject line of the email should read: "Fair Lending Webinar"). [ Return to Top ]

CUNA Regulatory Advocacy Report - Week of April 1

Each week CUNA provides credit unions a wealth of information through its Regulatory Advocacy Report. The report for the week of April 1 looks at the formula used by the NCUA for the Temporary Corporate Credit Union Stabilization Fund and how the assessments going back to 2010. The report also highlights the efforts by the CFPB on amending Reg Z and student loan affordability. 

To read the most recent CUNA Regulatory Advocacy Report, click here.
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Compliance calendar and training

March 2013

For the complete list of calendar dates and compliance trainings, visit the LSCU Compliance Calendar on InfoSight. 

*Note: To view InfoSight content, it is required to log in to www.lscu.coop for access. [ Return to Top ]

Communications News
An hour of your time to recognize worthy CUs and CU professionals - LSCU/CUNA Awards
    • Do you know a CU professional or volunteer that has made an outstanding contribution to the CU movement?
    • Has your CU shown excellence in day-to-day operations, community outreach, and financial prowess during 2012?
    • Does your CU demonstrate the credit union "People-Helping-People" philosophy in the community or practice internal programs to improve members' lives?

    If you answered yes to one of more of the questions, submit an entry today. Submission deadline has been extended to April 5. For more details about the awards, click to view the LSCU Awards brochure.

    Entries for the CUNA Awards programs are now also being accepted:

    • Dora Maxwell Social Responsibility Community Service Award
    • Louise Herring Philosophy-in-Action Member Service Award
    • Desjardins Youth and Adult Financial Education Award

    Information and submission forms for these three awards may also be found on the LSCU CU Awards Program web page.

    Visit the LSCU CU Awards Program web page for more information and entry/nomination forms on all listed awards. Questions? Contact LSCU Director, Communications Amy Jowers at 866.231.0545 ext. 1020.
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    Education News
    Upcoming webinar on frontline compliance

    Having knowledgeable frontline employees is imperative to any strong financial institution. This webinar is designed to refresh and update the frontline on important regulatory issues, recent or pending changes, and penalties for noncompliance. Regulation D, CC, TISA, Regulation E, and BSA will be addressed. This will be a fast-paced update that will ensure your financial institution is in compliance with annual training requirements.
    For more information, click here.  

    When your credit union registers for an LSCU webinar (provided by the Credit Union Webinar Network), a “virtual punch card” will be maintained for you. Each time your credit union registers, you get one punch. After attending 12 webinars in a calendar year (including archived programs), your credit union will automatically receive a complimentary certificate for a free webinar!

    This loyalty reward will stretch your credit union’s training budget and provide quality webinars for every member of your staff.

    Get started on your 2013 dozen today! To see available webinars, click here. [ Return to Top ]

    Cooperative Initiatives News
    LSCU debuts Credit Union Certified Financial Counselor Training (FiCEP)

    Earn your Credit Union Certified Financial Counselor (CUCFC) designation through the REAL Solutions Enhanced Financial Counseling Certification Program (FiCEP). The LSCU and the Southeastern Credit Union Foundation (SECUF) are pleased to partner with the National Credit Union Foundation’s (NCUF) REAL Solutions program and CUNA to offer this unique financial counseling training program.

    The participation benefits include:

    • Proven financial counseling skills that become part of the credit union’s culture
    • Written so anyone can offer financial counseling during member interactions
    • Certification that satisfies members’ needs as they continually look for the value of a credit union
    • Differentiates a credit union by having certified financial counselors
    • Helps members transform the way they deal with money through real-world counseling

    The deadline for the 2013 class registration is April 29. Click here to view more information about the program and a program schedule. LSCU will order all the materials and distribute them to participants.

    FREE informational webinar: To learn more about the FiCEP program, an informational webinar is scheduled for Wednesday, April 11, at 9 a.m. CDT/10 a.m. EST.  To register for the webinar, click here.

    Credit unions interested in having staff trained to become financial counselors should contact LSCU Director of Member Relations Adena Whitman at 866.231.0545 ext. 2134. [ Return to Top ]

    Financially fit day Wednesday April 3

    The National Credit Union Foundation (NCUF) and the Southeastern Credit Union Foundation (SECUF) are reminding credit unions that "Financially Fit Day” is Wednesday April 3. This day kicks off National Financial Literacy Month. This fundraising day is part of a new campaign, entitled “Credit Unions Support Financial Education: Leading the Way to Financial Freedom.”

    Credit unions are encouraged to carry out either (or both) of the following activities:

    • Hold a “Financially Fit Day” on Wednesday, April 3
    • Fundraise throughout the month of April

    Fundraising could be as simple as a jeans or casual day for staff, but additional ideas are included in a toolkit at the "Financial Fit Day website." Also included on the website are other campaign resources such as optional pledge forms, sample newsletter articles, sign-up sheets, stickers, flyer, statement stuffer, wall pin-up templates, a YouTube video, web buttons, and more.

    Find out more details by visiting the SECUF website. [ Return to Top ]

    LEVERAGE News
    LEVERAGE partner to hold credit union forum

    Vining Sparks, a leading provider of credit union investment products and services and business partner with LEVERAGE, will host the 2013 Credit Union Forum on May 16 - 17 at the Embassy Suites Hotel in Memphis. The day-and-a-half forum is designed for credit union executives and focuses on investment portfolio and balance sheet management. Attendees will have a wide range of educational options with sessions and materials up-to-date and applicable to the current environment.
     
    Whether you are a first-time attendee or an alumni, the Credit Union Forum will provide new perspectives, enhance your understanding, and better position your credit union for the future.
     
    The agenda allows time to network as well as time with Vining Sparks’ strategists, analysts, and management. On Thursday evening of the forum, attendees can head to downtown Memphis for the Memphis in May festival. Check the Credit Union Forum website for more on the agenda and to register.

    Contact a LEVERAGE Business Development Consultant for more on Vining Sparks or to learn more about the Credit Union Forum.   [ Return to Top ]

    Regulatory briefing webinar offered by ComplyTrac engine

    Keeping up with the regulatory burdens on credit unions is a full time job. LEVERAGE's ComplyTrac can take the regulatory and compliance pressure off staff allowing them to focus on more member-centered tasks. Continuity Control, the engine behind ComplyTrac, is offering a regulatory briefing webinar on April 4 at noon CDT.

    The briefing will include:

    • An update on 1Q’s final rules, proposed rules and other items across all agencies
    • Outline regulation changes in the areas of Compliance, IT, Safety & Soundness, Trust, etc.
    • A regulatory index which provides an assessment of what these changes will mean in terms of “workload”
    • Trends that will help determine what to prepare for the future

    To register for the briefing, click here. To learn more about ComplyTrac and how this solution works for credit unions, contact a LEVERAGE Business Development Consultant.
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    News from You
    First Commerce Credit Union awards $2,000 to the Foundation for Leon County Schools


    First Commerce Credit Union (FCCU) and Dale Earnhardt Jr. presented the Foundation for Leon County Schools with a check totaling $2,000, recently. First Commerce raised the contribution by encouraging their NASCAR fans to donate to the Foundation and register for a chance to win a special meet and greet autograph session with driver Dale Earnhardt Jr.

    “We are so grateful for the support of First Commerce Credit Union and Dale Earnhardt Jr.” said Diana Oropallo, chair-elect of the Foundation for Leon County Schools. “It’s so wonderful to see local businesses coming together to support our public school system and the continued academic success of our students.”

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    Alabama Telco announces recent appointments



    Lisa Courson was named AVP of regional branch operations. Courson has been with the CU since 2001, and has more than 25 years of experience in the financial arena. She oversees the operations of Alabama Telco’s southern branches located in Montgomery, Mobile, Dothan, and Geneva.


    Martin Hartline was named AVP of regional branch operations. Hartline has been with the CU since 2004, and has more than 20 years experience in the financial arena. He oversees the operations of Alabama Telco’s branches located in Hoover, Trussville, Helena, Pelham, and Madison.

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    EMPLOYMENT
    View available credit union jobs

    To view available jobs posted by credit unions on the LSCU website, visit the LSCU CU Jobs Center. Click the link at the top of the CU Jobs Center page to view jobs at the LSCU. [ Return to Top ]

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