Volume 29, Number 8                                                                  May 15, 2009

HEADLINE NEWS

2009 Youth Savings Challenge Smashes Records
     The Credit Union National Association’s (CUNA) 2009 National Youth Saving Challenge has more than doubled last year’s record in deposits. The challenge brought in more than $26 million in deposits, compared with $12 million brought in last year.
     “By more than doubling the amount they saved last year, our young members have told us loud and clear that they believe in the future,” said Dan Mica, CUNA president/CEO. “Their willingness to set money aside for their goals during a severe recession should inspire the rest of us to redouble our efforts to advance the credit union principles of thrift and the productive use of credit. This phenomenal vote of youthful optimism could not have come at a better time.”
     About 397 credit unions – including eight in Delaware – reported receiving deposits from 139,669 young members, including 10,006 who opened new accounts. This year’s results average out to $190 deposited per child. Last year's nearly $11.8 million savings total averaged $156 deposited per child, up from $87 per child in the 2004 inaugural year.
     For the first time, credit unions had the option of hosting the challenge throughout April, which was National Financial Literacy Month. This year’s theme was “The Magic of Saving,” which celebrated the magic of one of the most basic pillars to financial independence.

Delaware CU Week Activities
     Eight Delaware credit unions that participated in the Youth Saving Challenge reported opening 174 new youth accounts, with over 1,000 children adding to existing accounts. Credit unions who reported to CUNA include American Spirit, Del-One (Delaware FCU), DEXSTA, Dover, New Castle County School Employees, Preferred Financial, Sussex County, and Wilmington Postal. The following credit unions reported events held during this celebration:

     AMERICAN SPIRIT FCU hosted an essay contest and a coloring contest, with submitted pictures displayed in the credit union lobby. There was also a jellybean count contest, and free books, magic chests, and piggy banks were given out.

     Magic was in the air on Thursday, April 23, as over 100 students from local elementary schools joined DEL-ONE to celebrate CU Youth Week.  Students from Nellie H. Stokes, North Smyrna Elementary and Sunnyside Elementary participated in “The Magic of Saving” essay contest, sponsored by Del-One, and earned a magical day at the credit union’s West Dover branch. Upon visiting the branch, students gained a firsthand look at the products and services available to help them and their families save. They visited the cyber-café, a coin-sorting station, the vault, and safe deposit room. From making a bird appear out of nowhere to having students magically pump and pour milk out of another student’s arm, “The Magic of Guido” was a grand finale to an exciting day.

Students visiting Del-One volunteer to assist during “The Magic of Guido.”

    DELAWARE ALLIANCE FCU also hosted a special performance of “The Magic of Guido” for members’ children. The CU office was decorated in money, and the staff all wore black magic hats and black pants and white shirts with a magic wand.

     A lot of the week’s activities were aimed at children under 12, but DEXSTA FCU introduced a new savings program tailored for teen members ages 13 through 17 called $tash. DEXSTA’s $tash web page features a free interactive website for both middle and high school students. The website features a free online interactive financial tutorial, Guides to Independence™, where teens can learn about buying their first car, saving for something special, or just finding out how to make wiser everyday financial decisions. They’ll also receive a free eMusic® download at the completion of each course. DEXSTA has a second savings program – called Bill & Penny – for youth members ages 6 through 12.

DEXSTA FCU promotes two programs
to attract youth to the credit union.

     LOUVIERS FCU participated in “The Magic of Saving” promotion by handing out various promotional items and holding drawings at all four branches for digital talking piggy banks for the younger kids.

Two delighted Louviers Federal Credit Union members with their digital banks.

     The Seaford branch of SUSSEX COUNTY FCU kicked off the “The Magic of Saving” youth week with a special fair held at the credit union on April 18. The magical afternoon featured refreshments, face painting, story telling, and a moon bounce. At the same time, adults were encouraged to bring in their confidential documents for shredding.

COMPLIANCE UPDATE

NCUA Provides Weekly Corporate Credit Union Update
     NCUA reported that normal operations continue without interruption at U.S. Central Federal Credit Union (U.S. Central) and Western Corporate Federal Credit Union (WesCorp) in the agency’s weekly update on May 8. The following items are of note:
•    On May 1, WesCorp posted the corporate’s March 31, 2009, financial statements online. The Other-Than-Temporary-Impairment (OTTI) charges reflected on these financial statements are $5.8 billion. This resulted in the exhaustion of all Paid-in-Capital (PIC) and Membership Capital Accounts (MCA) at WesCorp.
•    U.S. Central planned to release its March 2009 financial statements in May. As reported to its members recently, 100% of PIC and 63% of MCAs have been exhausted.
•    Member communication and outreach efforts continue. U.S. Central reported no formal member meetings this week. WesCorp held a webinar for member credit unions on May 7 and will begin a series of town hall meetings on May 18th.
•    NCUA will issue guidance soon in the form of a Letter to Credit Unions for holders of corporate credit union PIC and MCA accounts, explaining the implications of exhausted PIC and MCA.
•    Later this month, the NCUA Board will be considering changes to the Temporary Corporate Credit Union Liquidity Guarantee Program to provide longer term funding options for all corporate credit unions.
     In response to questions raised following the announcement of expected Other-Than-Temporary Impairment charges at the two corporates, NCUA Board Chairman Fryzel stated, “I am aware the announcement last week of U.S. Central’s expected Other-Than-Temporary Impairment charge and resulting impact to PIC and MCAs raised some questions pertaining to NCUA’s $1 billion capital note in U.S. Central. The OTTI charge results in a 63 percent exhaustion of U.S. Central’s MCA accounts, leaving the balance unencumbered and available as a buffer to absorb losses in front of the NCUSIF capital note. This understandably generated discussion on the need to fully impair the NCUSIF capital note in NCUA’s reserving for share insurance fund losses. I want to assure the
credit union community that, before any final invoices are mailed out, NCUA will perform an updated analysis to reflect an accurate and realistic assessment charge, keeping in mind there are some differences between the accounting for OTTI charges at the institution level and reserving requirements for the share insurance fund.

Fed Approves Reg Z Changes
     The Federal Reserve Board on May 8 approved revisions to its Regulation Z mortgage disclosure requirements that will implement provisions of the Mortgage Disclosure Improvement Act (MDIA). Under the MDIA, lenders would be required to provide full loan cost estimates to potential homebuyers before the lender could receive any form of payment, outside of credit check charges, from the borrower.
     The rules would also enact current MDIA rules that impose a weeklong waiting period between the aforementioned cost estimate and the closing of the mortgage. Additionally, lenders would need to provide new disclosures, including a revised annual percentage rate, if the existing interest rate significantly changes between the time that the first estimate is given and the closing date.
     Borrowers may also change the timing of the loan disclosures or the closing of the loan, in the event of a so-called “financial emergency.”
     The new rules will apply to all mortgage applications received on or after July 30, 2009. The Fed is currently working on further revisions to the Regulation Z disclosure requirements for closed-end rules, including rules addressing mortgages.

More Mortgage Lending Changes
     Effective May 1, 2009, Fannie Mae and Freddie Mac will no longer purchase mortgages from sellers that do not adopt the Home Valuation Code of Conduct (HVCC) with respect to single-family mortgages that are delivered to Fannie/Freddie. Also, effective for single-family mortgages with loan application dates on or after May 1, 2009, Fannie/Freddie sellers/servicers must represent and warrant that appraisals are obtained in a manner consistent with the HVCC. Information on the HVCC is available on either the Fannie Mae or Freddie Mac websites.

CU SYSTEM NEWS

Mid-Atlantic Corporate Announces 2009 Annual Meeting
     Mid-Atlantic Corporate FCU will hold its 2009 Annual Meeting, June 18-19, at the Wyndham Gettysburg Hotel in Gettysburg. This year’s meeting will begin with a product fair and evening reception on Thursday, June 18. A keynote speaker will kick off the annual business meeting on Friday morning after a hot served breakfast. In addition, Mid-Atlantic Corporate’s annual business meeting will cover the results of the Board election and the 2008 year-in-review will be presented. The annual Charity Golf Tournament will take place on Thursday, June 18, at The Links at Gettysburg. Proceeds from the tournament will benefit the Children’s Miracle Network. To learn more, click here or go to their website, www.midatlanticcorp.org.

Visions, Ink. 30th Anniversary
     This year Visions, Ink. is celebrating their 30th year in business. Since opening their doors in 1979, they have been committed to providing the highest level of quality marketing services to the credit union community.
     During the past 30 years, Visions has grown from three employees to a one-stop shop with 25 staff members. Today Visions can handle credit union marketing promotions from concept and design to printing and mailing all under the same roof.
     To celebrate their 30th anniversary and to show their clients how much they are appreciated, Visions is offering a $300 coupon to both existing and new clients for their next project. Clients will receive $300 off the design of a custom piece started after February 1, 2009, and completed before July 1, 2009. To find out more about this special offer or to obtain a coupon, call 866-844-4775.
     In addition to the anniversary celebration, the company welcomes new sales representative Mike Mohney to the team. Mike joins sales team members Maggie Fielding, Holly Foster, Mike Newman and Chris Johnson.

 New Pressing Issues Added to America’s CU Conference
     With so many fast-changing legislative, regulatory, and economic issues now on credit unions’ front burners, CUNA has added a slate of new sessions to the America's Credit Union Conference and Expo, scheduled June 21-24 in Boston. New breakout sessions include:
•    Critical issues update;
•    Legislative/regulatory update including spreading out credit unions’ costs associated with the corporate credit union network, bankruptcy, regulatory restructuring, and interchange fee income;
•    TARP 101 – analyzes this Treasury Department program for banks and its impact on credit unions;
•    Net worth restoration plan primer – explores the issues behind developing a restoration plan and what it means in terms of restoring net worth;
•    Facing up to problems in the credit union system – examines the future of corporate credit unions, NCUA’s approach to assisting them, and the effect on credit unions;
•    The Obama mortgage modification plan; and
•    New examination issues.
The America’s Credit Union Conference and Expo is the premier resource for learning and inspiration for executives, board members, and key leaders in the credit union industry. For more information or to register, go to http://events.cuna.org.

DELAWARE NOTES

The League announces the winners of the annual meeting golf outing, held at the Eagles Landing Golf Course near Ocean City on April 30. The winning team members were Ken Welch, Joe Reiner, Bob Chaffee, and Don DiMatteo. The second place team was John Lewis, Dick Stoops, Allen Riley, and Frank Taddeo. Anthony Hinds won the closest to the pin award and Ken Welch, the longest drive. Golf outing proceeds went to the League scholarship fund and CULAC.

Golf outing winners (l. to r.): Joe Reiner, Ken Welch, Bob Chaffee, and Don DiMatteo

Second place winners (l. to r.) Frank Taddeo, John Lewis, Allen Riley, and Dick Stoops

Condolences to the family and friends of two long-time credit union volunteers: Howard Mason of SUSSEX COUNTY FCU served as the chairman of the CU supervisory committee for many years. Nancy Banis of CHESTNUT RUN FCU was a former board member.

Mary Brien-Duch, vice president of finance at DEXSTA FCU, was quoted for an article in the May 6th Credit Union Times, which was entitled, “What Did Your Mother Instill in You That Has Helped You in Your Credit Union Career?”

Del-One (Delaware FCU) offers an excellent opportunity for an experienced mortgage lending professional to manage the daily processes of the 1st mortgage lending department. Interested candidates can learn more about the essential functions and job specifications of this opportunity by logging onto the credit union website at https://www.del-one.org/careers.html

May/June QuickBites Teleconferences
One-hour sessions run from 11 a.m.-noon:
►  5/19  Using Your Website to Drive Growth
►  5/28  Kids’ Stuff: Youth Accounts
►  6/03  Call Centers: Six Common Mistakes
►  6/22  Designing a Loan Department
►  6/30 Business Development in Community Charters
The two-hour sessions run from 11 a.m.-1 p.m.
►  5/21  Motivating/Managing the Teller Line
►  6/16  ACH
The fee for the one-hour sessions is $99; the two-hour session fee is $169. The deadline to register with Bernadette Hines: one week before the session.

Mortgage Council: New Mortgage Programs – Wednesday, May 23, from 10 a.m.-noon. No fee for registered council members; non-members: $100. R.S.V.P to Jane Bailey.

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.

Collection and Bankruptcy Updates Seminar – Wednesday, June 3, from 9 a.m.-4 p.m. Collection council members have a reduced fee of $75 for the first participant and $65 for the second. The fee for non-council members is $195. Registration deadline: 5/27.

June Council Meetings:
►  Lending Council: Tuesday,  June 9
►  Marketing Council: Monday, June 22
Both sessions will be held at the League office from 10 a.m.-noon, followed by lunch. There is no fee for council members; non-members - $100. Call Jane Bailey to enroll for lending by June 3. Call Alice Smith for marketing by June 15.

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).