Volume 29, Number 7                                                            April 30 , 2009

HEADLINE NEWS

2009 Convention Wrap-Up
     The Delaware League’s 51st annual meeting and trade show was every bit a success, according to those in attendance. This year the Clarion Hotel in Ocean City was our new venue, and the event was held April 30-May 2. During the event, we celebrated the 100th anniversary of credit unions, the 75th anniversary of the Credit Union National Association (CUNA), and the 51st anniversary of the League.
     With “Credit Unions: Best of Show” as a theme, the weekend featured a variety of educational, social, and business events for credit union professionals, volunteers, and their guests. Over two hundred people from 22 credit unions through out the state attended the three-day event.

Business Meeting Highlights
     Business conducted at the 51st annual meeting included election of two League board members.
     Incumbent board members Sharon Schaeffer (Delaware First FCU) and Kate Toner (Wilmington Postal FCU) were elected for three-year terms. At the reorganizational meeting, the board officers remained the same:
                        Joel Romaine (DPL) – Chairman
                        Jerry King (DEXSTA) – Vice Chairman
                        Kate Toner (Wilmington Postal) – Secretary
                        Meredith Jeffries (New Castle County Delaware Employees) – Treasurer
The remaining board members are Cheryl Chilcutt (Chestnut Run), Allen Riley (Sussex County), and Sharon Schaeffer (Delaware First).
    
Keynote Presentations    
     National Credit Union Administration (NCUA) Vice Chairman Rodney Hood addressed the attendees at the annual business meeting. He underscored the point that credit unions are not contributing to the credit crunch. Hood emphasized that the corporate stabilization plan is one of the hardest decisions that the Board has made. The Board’s actions are designed to enhance and support a corporate credit union system facing unprecedented strains on liquidity and capital due to extraordinary market disruptions and the current economic climate.
     Hood also commented on the agency’s actions to make sure there is no erosion of confidence in natural person credit unions through newspaper advertisements and infomercials hosted by columnist Jane Bryant Quinn, regarding the $250,000 share insurance coverage.
     Other NCUA plans underway include the importance of succession planning, since nearly 50% of NCUA senior management is eligible to retire in the next six months; efforts to support small credit unions; and the importance of credit unions mitigating both interest rate risk and balance sheet risk.

     CUNA economist Mike Schenk spoke on the state of the economy, with credit unions’ business model showing a number of strengths. Statistics show that credit unions saved their members $9.25 billion in 2008. In Delaware, that savings was $27 million or $250 per household. Delaware credit unions also saved members an average of $1700 on a five-year new car loan.
     Schenk commented on what the present economy means for credit unions:
•     Faster savings for members and asset growth;
•     Slower organic loan growth;
•     Significant increases in loan delinquencies and losses;
•     Substantial downward pressure on net income;
•     And falling net worth ratios.

CULAC Fundraising
     George and Kathy Bush, Anthony Casarino, Pat Mahaney and the League Governmental Affairs Fund donated items for the CULAC raffle, which generated $629. Sussex County FCU and the League also donated golf clubs for the raffle, which brought in another $345. With the addition of a 50/50 drawing at the dinner dance, a total of $1129 was raised for the Credit Union Legislative Action Council (CULAC).

Business Meeting Speakers
     Greetings and comments were given at Saturday’s business meeting by Jay Murray of Mid-Atlantic Corporate FCU; Paul Butler of CUNA Mutual Group; and Christopher Pippett, the League’s retained counsel. The remarks made by League board chair Joel Romaine and president Pat Mahaney are included at the end of this newsletter.

Fun Events
     During the Thursday night reception and Friday morning trade show, participants had a chance to wander through the exhibits and pick their favorite “pooch” from the 24 pictures of pets submitted by their owners. The winner of “Cutest Canine Contest” was “Boots,” a mountain cur, whose picture was submitted by Sharon Schaeffer of Delaware First FCU. The proceeds from the contest – $1400 – were donated to Paws for People. 
     Another “best of show” award went to Sandy Shenk of the Pennsylvania Credit Union Service Centers for her theme-related booth. On Friday evening, everyone nostalgically remembered the rock and roll days through the music of the Dovells, who originated the Bristol Stomp. The conference ended with a luncheon and karaoke singing. The final “best of show” award went to the singing group from ICI America FCU.
   
And Finally, Awards!
     League education director Bernadette Hines announced at the business session that 68 certificates were earned by six credit unions in 2008. As a result, the following credit unions received awards:
•     CU attending most seminars in 2008 – New Castle County School Employees FCU
•     CU earning most STAR/MERIT certificates – Del-One (Delaware FCU)
•     CU earning most VAP certificates – DPL FCU

New Castle County School EFCU Ray Christian, President	Del-One Bob Seaberg, Chairman	DPL FCU Bob Oakes, President

Professional/Volunteer Awards
     The Delaware Credit Union League recognized Edwin Grebe as the 2008 Outstanding Credit Union Professional. Ed signed the charter for the League’s organization on September 18, 1958. He currently serves as the manager of the Newark, Delaware City Employees Federal Credit Union,
     Ed has served the credit union movement in Delaware for over 50 years. In his first credit union role, he was the supervisory committee chair and eventually volunteer treasurer for NVF Yorklyn Fibers FCU. Ed went on to serve as a volunteer with the All American Engineering FCU. He did credit union auditing for the League for eight months, which led to a management position at WS/EDL FCU and eventually to management of Hercules FCU. During that time he also served as volunteer treasurer of Delaware Central Federal Credit Union, which was founded so that credit union volunteers and employees could get loans, because they were prohibited from obtaining loans from their own credit unions. Ed also served on the board of WS/EDL FCU until its consolidation with Louviers FCU. Ed was coaxed out of retirement to run the Newark, Delaware City Employees Federal Credit Union and is still going strong.
     Ed’s nomination letter gave two strong examples of his willingness to aid credit unions in their times of need and to help members achieve their financial goals. Ed responded to a recent request from a Florida credit union asking for help in assessing the value of a delinquent member’s car, which was now located in Delaware. He agreed to take the time to review the car and send the necessary information back to the credit union.
     The nomination also cited Ed for helping Newark, Delaware City EFCU members in times of need, whether for lending or saving or just financial help in general. According to the letter, “He works diligently to assure all members are satisfied with our services. He not only works with the members, but also covers as our computer technician. There isn’t anything he can’t do with the system and equipment in our office. Our manager also does everything he can to ensure we keep expenses in line.
     “Our manager’s concern for our members and elected officials is evident in day-to-day operations. He will deliver a check to the offices of any member in need of a quick withdrawal; he will deliver loan applications to those who need to apply for a loan. He stays on top of the credit union industry’s current events and provides all details to the board and committees.” 

     This year, two volunteers were recognized for their outstanding service to their credit unions.
       The first Outstanding Credit Volunteer Award for 2008 was awarded to Anthony Casarino, board president of ICI America FCU. The nomination letter made the following statement:
     “Since becoming president of the credit union board over the last six years, Tony has brought stability to the board. This has included making board members aware of their duties toward the membership, keeping up with regulatory changes that come upon us so fast, and seeing that we are in compliance with NCUA rules and regulations. Our board president also follows up on internal audit reports.
     “As a member of the League’s Governmental Affairs Committee, he keeps us informed of new regulatory developments that will affect the credit union. Tony has personally raised money for CULAC and Credit Union House at our annual meetings through door prizes and 50/50s. 
     “Our credit union has moved four times in 2008, and Tony has worked with the manager and staff to make sure we keep our charter at all costs. Currently, he is encouraging us to increase our field of membership, so we can regain members lost when one of our key plants closed in 2008. Sometimes, board presidents and managers don’t always agree on certain issues at the board meeting, but when all is said and done, our board chair will listen.”
     Tony has been a member of the credit union for 16 years and has been a volunteer for 15 of those years.

     Our second Outstanding Credit Union Volunteer for 2008 was John Lewis, board chairman of Sussex County FCU. He has been a credit union member for 46 years and a volunteer for 26 of those years.
     John was first elected to the credit union’s board of directors in 1983. Since then, he has served 26 years on the board, of which 24 years have been spent as the chairman. His leadership has served the credit union well, bringing it from a $20 million credit union to a $200 million dollar credit union.
     The nomination letter made these comments about John’s service. “His entrepreneurial spirit has helped the Board make hard decisions. He had the foresight to recognize that the credit union needed to expand beyond its original field of membership, and he led the effort to convert to a community charter in 1998.
     “Many credit unions seem to have lost sight of their purpose and instead seem driven by goals that aren’t necessarily in the best interests of their members. Our nominee’s passion for people has kept the credit union focused on the member.
     “While member focused, he is also conscious of the need to balance service with the general needs of the credit union. His dedication to the credit union and doing the right thing for the credit union and its members is inspiring.”
     Sussex County CEO Pamela Fleuette, who submitted the nomination, made the following comment, “I believe it is also important to recognize the spouses of credit union volunteers. John’s wife, Winnie, is also very involved in supporting the credit union, particularly at credit union sponsored social functions, conferences, etc., often volunteering to work on planning and organizing such events. She has supported her husband in the hours spent at the credit union and away from family.” This is the first time a nomination letter has ever acknowledged the spouse’s support, although we know it is true in many other cases as well.

Milestone Anniversaries
     Congratulations to the members, volunteers and staff of the following credit unions that were recognized at the annual meeting for celebrating milestone anniversaries in 2009:
•     Milford Memorial FCU – 40 years
•     Provident FCU – 45 years
•     Chestnut Run FCU – 50 years
•     First State Refinery FCU – 50 years
•     Sussex County FCU – 50 years
Those credit unions celebrating fifty years of service received a commemorative plaque from the League and CUNA at the annual meeting.

Chestnut Run FCU Deborah Harmon, Chairperson	First State Refinery FCU Prem Tandon, President	Susssex County FCU John Lewis, Chairman

DELAWARE NOTES

DEXSTA FCU’s fourth annual Shred-A-Thon was held on Saturday, April 25, at the Prices Corner Branch at 1320 Centerville Road. Events included a live broadcast by WSTW/WDEL and a drawing for a cross-cut shredder. This year 19,101 pounds of paper were shredded for recycle, which translates to 153 saved trees, according to Karen Terry, marketing administrator. CEO Jerry King and twelve staff members participated in the event.

Congratulations to EAGLE ONE FCU CEO John King, who is celebrating 20 years of service to the credit union in 2009. At the time that John was hired, the credit union was known as Railway FCU.

DEL-ONE (DELAWARE FCU) participated in the 4th Annual Hispanic Expo and Job Fair, sponsored by the La Exitosa 930AM radio station and Delaware State University. The event was held at the Delaware State Fairgrounds on April 19 from 12-4 p.m. Several of Del-One’s bilingual employees were on hand to educate the attendees about financial services and CU services.

Pictured to the right is one of last year’s bike winners, Eberto Gonzales, and former Georgetown Assistant Branch Manager Jorge Hernandez.

Business Lending Officer. Responsibilities include developing and retaining commercial business, meeting with prospects, and managing the loan through approval to closing. Also, attending community events, working along with SBA in making presentations to businesses, cold calling, networking, and increasing awareness of the credit union in the community. Candidates must be flexible in their schedules and possess excellent communication skills. Requires a four-year degree or the equivalent combination of education and work experience. Also 3-5 years commercial lending experience required, including understanding commercial business development techniques and credit decisions, business development and sales ability, strong credit and financial analysis skills, negotiation and closing skills. Excellent communication skills, both verbal and written, and PC skills. Please send resume and salary requirement to: American Spirit FCU, Attn: HR Department, 1110 Elkton Road, Newark DE 19711.                                                                                                                               
                                           
Collection Manager. Sussex County FCU is seeking a collection manager to oversee the daily operations of the Collection Department and to provide leadership and guidance to the collections staff. In addition, this position is responsible for ensuring compliance with all collection policies, procedures, rules and regulations. Qualified individual will work with outside vendors, attorneys and the court system to maximize collection efforts. Will also prepare reports, monitor delinquency trends and make recommendations to help minimize losses. Candidates should have a minimum of two years collection and supervisory/management experience, strong leadership and organizational skills. Send cover letter, resume and salary requirements to Sue Hoefs at
shoefs@sussexcfcu.com or SCFCU, P.O. Box 1800, Seaford, DE 19973. Fax: 302-629-2583.

EDUCATIONAL OPPORTUNITIES

May QuickBites Teleconferences
One-hour sessions run from 11 a.m.-noon:
■    5/13  Creditors’ Resources
■    5/19  Using Your Website to Drive Growth
■    5/28  Kids’ Stuff: Youth Accounts
The two-hour session runs from 11 a.m.-1 p.m.
■    5/21  Motivating/Managing the Teller Line
The fee for the one-hour sessions is $99; the two-hour session is $169. The deadline to register with Bernadette Hines: one week prior to the session.

Mortgage Council: New Mortgage Programs – Wednesday, May 13, from 10 a.m.-noon. No fee for registered council members; non-members: $100. R.S.V.P to Jane Bailey by May 8.

Supervisory Committee Duties/Responsibilities – Tuesday, May 19, from 5-7:30 p.m. at the League. Fee: $65. Call to see if space is available.

Bank Secrecy Act: Two sessions for two different audiences on Wednesday, May 20.
■    Extended Session: 9 a.m.-3 p.m. at the League (if space allows). Fee: $90.
■    Basic Overview: 5:00-7:30 p.m. at Del Tech, Stanton Campus. Fee: $65.    
Space is limited, so contact Bernadette Hines to see if seating is available. 

Board Chairman Joel Romaine’s Comments
Presented at the League Annual Meeting on May 2, 2009

I am sure you’ve heard this ancient Chinese curse:

                        May you live in interesting times;
                        May you come to the attention of those in authority;
                        May you find what you are looking for.
           
It’s not really Chinese in origin, but that’s a speech for another day. This curse is probably related to the Chinese proverb, “It’s better to be a dog in a peaceful time than be a man in a chaotic period.” The implication is that “uninteresting times,” full of peace and tranquility, are more life enhancing.  

While some of us may feel that these last twelve months has been far too interesting, we cannot deny that this is an exciting time to be alive. Some of us don’t like things to change and will fight it both tooth and nail, but change is inevitable. Why some of us resist change, while others embrace it, remains a mystery to me. Surely, from the moment each of us recognizes our own mortality, it must be obvious that change is inevitable. 

Although we would like to believe that mankind has experienced long periods of uninteresting times, the historical record shows that uninteresting times are merely brief respites from one upheaval until the next. The fact that we have chosen to meet here today, rather than hide at home, heavily sedated, is a testament to our ability to deal with “interesting times.” Though life isn’t always pretty, or fair, or painless, the human race marches on, with a confidence that we will survive turbulent times.

Last year, at our League’s 50th anniversary, I remarked that 2008 was also the 100th anniversary of America’s first credit union, and although a lot had changed in those first hundred years, our collective mission had not. In that brief span of time, the United States has experienced at least six major wars, a Great Depression, several recessions, assassinations, and the September 11th attacks. Yet here we are today, proof positive that although living in interesting times tests us, it also imparts wisdom, gives us strength, and makes us better for the experience.

A lot has changed for Delaware credit unions since we last met. Once again there are fewer of us than there were last year. The economic realities of these interesting times and the NCUA’s recent corporate stabilization plan may destabilize many of us and send some of us into the red for the first time. 
 
Everyone is a genius in a booming economy, but in today’s environment, how do we pay our members the dividends they have grown accustomed to, when we are hard pressed to find both credit worthy borrowers and safe investments with attractive returns? How do we convince our members that the red numbers we must report are temporary and that as good stewards of their credit union, we cannot pay out greater dividends?   

This year we will be called upon to exercise our ALM talents as never before; we will have an opportunity to test whether those theoretical economic discussions, which we have often engaged in, actually work in a real meltdown. This year every credit union manager should qualify for combat pay. Each director, as part of their fiduciary responsibilities, will be called upon to make difficult decisions necessary to ensure the survival of their institution. 

I don’t know about you, but it warms my heart to know that in spite all of the chaos in the banking world, our friends at the American Bankers Association have not forgotten about us. Although, as an industry, banks have demonstrated an inability to oversee their own shops, they still can find the time to express their concern about how we run ours. I haven’t heard them express concern that the fallout from the banking meltdown has resulted in a dangerous concentration of assets in the hands of three mega banking institutions. I fear that the phrase “too big to fail” may actually mean too big to effectively regulate.  
 
Although I am not a fan of the expression “that which doesn’t kill you makes you stronger,” it is, in fact, the reality of human existence. But, it’s not my intention today to either scare or depress you. Rather I am here today to proclaim that Delaware’s credit unions stand united and ready to embrace the challenges of these interesting times. Today, we are sustained and soothed with an unfaltering confidence that is derived from over a hundred years of staying true to our mission.
 
Credit unions were formed to help the common man cope with financial problems, and right now our members are doing a lot of coping. Many of us are receiving more member requests for help to pay existing loans, rather than requests for additional funds. But, this will eventually change. Slowly, but surely, the federal programs proposed and instituted along with the greatest healer of them all – the passage of time – will restore consumer confidence and spur the economy. It won’t be long before our members will awaken to a new reality. Once again, they will have dreams that need to be financed. 

Hopefully, we have learned something from these interesting times, and when consumers borrow, they will ask more questions, not give in to every impulse, and have realistic long-range financial plans. We have been good stewards of our credit unions and through the years have grown our capital, positioning Delaware credit unions to survive these interesting times.

The great thing about our annual meetings: it is an opportunity for us to come together and find comfort, knowing that we share a common experience. Although, more than ever, we compete with each other, we can still meet here as friends. This cooperative spirit is something that credit unions need to nurture, cherish, and protect. The Delaware League is a valuable resource, which helps us maintain and celebrate our uniqueness and can act as a mediator when we have differences.

Yes, these are interesting times, but America was born and nurtured and has prospered in interesting times. It is the innate spirit of the American people that has made us great. We, as a nation, have never been afraid of the future or been afraid of a challenge, and as a nation we will get through this current economic quagmire. As we have for the past 101 years, America’s Credit Unions will be there in both interesting and non-interesting times, serving our members’ needs and contributing to the greatness of this nation.     

League President Patrick Mahaney’s Comments
Presented at the League Annual Meeting on May 2, 2009

Welcome to all our guests! To our members in attendance here today, I also extend a warm welcome! You are marking in history the Delaware Credit Union League’s 51st Annual Meeting.

We also take time to note that the credit union movement started in the United States in 1908 and our first credit union was chartered in 1909. That is one hundred years of “people helping people.” Now also, we celebrate the passage of the Federal Credit Union Act in 1934 – a mere 75 years of age.

We are talking about history, which has offered many challenges to our system. Let’s talk about challenge! Please take a moment to write this down in block letters.

CHALLENGE

“C” is for Communications. Everything we do starts with communications. We have heard this time and again and that hasn’t changed. The trick is to measure it so we don’t inundate and turn off the receiver. As a system, we need to continue to talk together.

“H” is for the History we celebrate. We study it but do we learn from it? History is a marvelous predictor of the future. We need to be able to read the signs along the road. Historical data is more available then ever. We need to be better prepared to interpret and use it.

“A” means Action. Credit unions need to move forward in our thinking and our way of doing business. We need to be more progressive and proactive in our strategic planning – willing to promote new ideas and to accept that change is inevitable.

“L” is for the Lapses that we have suffered from in the past several years: lapses in judgment, common sense, controls and most of all in ethics. Please take note that most of these lapses were made by others, but we are not totally blameless.

“L” is for all the financial Losses – an area where not just credit unions but everyone has felt the pinch. We are a cooperative, and as such we share in the responsibility of protecting our way of doing business. So these losses are felt and shared.
 
“E” is Emotion – reacting to legislative changes, job reductions, bad loans, business losses, sponsor changes, etc. There are many emotionally charged events occurring around us almost daily. We need to realize we have moved into a different world where events happen, and we need to find ways to deal with them and work them to our advantage.

“N” is for Networking. The need for this has never been more apparent. By cooperating and working together, we can maintain our relevance. We can achieve market growth and forge a lasting relationship with a new wave of membership.

“G” is for Governance as important today as it was 100 years ago. Somewhere we have lost the handle, and we need to get a grip on our financial systems and prevent the economic disasters we have been experiencing. Tighter controls and a better, more responsive, and intuitive regulatory system is required.

“E” is Education. With technology moving at its pace, with the complexity in higher investment vehicles, and the expected changes in regulations, it is no longer important to keep up. It becomes mandatory just to keep pace.

There are many challenges before us including the following:
■    We have a big cost added to doing business by way of bolstering our insurance fund and tiered corporate system.
■    We need to grow our membership, in that we need to attract youth into the system, yet manage our traditional membership.
■    We must be able to add services that our members need. These include member business services and loans.
■    Technology moves at a pace not very comfortable within our movement because of our very conservative natures. We must adapt.
■    There is a growing need to protect member privacy and information.
■    We must face the ever present government and forthcoming regulatory changes in governance, oversight, mortgage and bankruptcy reforms, Bank Secrecy Act regulations, auditing, and items too numerous to list.
■    Shifting populations, especially growing minority presences, will offer language and cultural challenges.
■    Accounting changes will bring added stress.                                            
■    Then, of course, we are dealing with the economy, such as it is, and our challenge is to find ways to be profitable, proactive and a permanent force for our members.

Quite a full plate, daunting some would say! However to meet these challenges we need to change. Take that word “challenge” that I had you write and remove the “L,” “L,” and “E.” We are left with the word CHANGE.

If we can eliminate the lapses in control, ethics, and judgment, we have made a great leap towards change. We can manage our losses on the business side but can ill afford to lose ground within the regulatory process or allow an erosion of the gains in public acceptance and good will we have attained during these trying times. This too is a change for us.

If we can manage the emotional side, we must come to the realization that, to compete, we will need to be more dispassionate in our decision processes. However, we will need to maintain our heart and sense of community purpose. That will effectively have moved us from our challenges to change.

Now to maintain “change,” we have to learn from history, get our governance issues under control, and continue to promote education throughout the ranks. Accomplish this and we have moved from our challenge to real change.

So remove the letters “H,” “G” and “E.” That leaves us with CAN.

Communication, action and networking are the constants. As a system, credit unions will need these three components to accept and meet our challenges.

Credit Unions can accept the challenge!

We will use communications, actions and networking to effect change!

Credit Unions can change!

If we say it, we do it, and we do it together, that means “Credit Unions CAN!!!!”

TOGETHER is published on the 15th and 30th of each month by the Delaware Credit Union League, 4 Quigley Boulevard, New Castle, DE19720. Information to be published should be sent or phoned into the League no later than the Monday of the week preceding the publication date. Telephone: (302) 322-9341 or (800) 292-7875. This newsletter can also be found on the League website: www.dcul.org. Hard copies of the newsletter will be mailed to each credit union CEO/manager for distribution to those without computer access. Readers can receive a reminder when the newest edition is posted to the Web by emailing susan@dcul.org. Editor: Alice Smith (alice@dcul.org).