On April 4 the members of $1.4 billion Central Corporate CU (CenCorp) voted in favor of the proposed merger with $1.4 billion Alloya Corporate FCU (Alloya). This follows the NCUA’s approval of the merger on March 14, 2013. The effective date of the merger is April 30, 2013.
On March 21, the Consumer Financial Protection Bureau (CFPB) issued bulletin 2013-02, explaining that certain lenders that offer auto loans through dealerships are responsible for unlawful, discriminatory pricing. Although this bulletin provides guidance to indirect auto lenders within the CFPB’s jurisdiction, it is important for all credit unions that have indirect lending relationships to note the potential violations to the Equal Credit Opportunity Act (ECOA) that may occur in these types of relationships. Specifically, indirect auto lenders may not permit dealers to increase consumer interest rates and compensate dealers with a share of the increased interest revenues. Because of the incentives these policies create, and the discrimination they permit, there is a significant risk that they will result in pricing disparities on the basis of race, national origin and potentially other prohibited biases.
Credit unions should take steps to review their existing indirect relationship and lending program to ensure they are operating in compliance with the ECOA and Regulation B as applied to dealer mark up and compensation policies. These steps may include, but are not limited to:
· Imposing controls on dealer markup, or otherwise revising dealer markup policies;
· Monitoring and addressing the effects of markup policies as part of a robust fair lending compliance program;
· Eliminating dealer discretion to mark up buy rates, and fairly compensating dealers using a different mechanism that does not result in discrimination, such as flat fees per transaction.
For reference, there are steps included in the CFPB bulletin, along with some features of a strong fair lending compliance management program.
Mobile services are particularly prevalent among the “unbanked” or “underbanked”, which are those consumers who have banking accounts but also use alternative financial services such as a payroll card, payday lender or check casher. Ninety-percent of this group had mobile phones, and among them, 49% used mobile banking during the 2012 period, up from 29% in 2011. Among the unbanked consumers, the most commonly cited reason for not having an account was simply not needing or wanting one (23%).
According to CUNA’s compliance blog from March 27, 2013 the NCUA is particularly concerned by the operational risks triggered by new technology (online banking, remote deposits, mobile banking, social media, etc.). Credit unions should expect an NCUA Letter to Credit Unions in the next few months on “eBanking”.
In summary, as identified in the FRB’s report, mobile banking continues to be an important member service tool and will also be useful in attracting the “unbanked” or “underbanked”. Credit unions utilizing this product and those credit unions considering entering the market should be cognizant of compliance issues, looking out for the NCUA Letter to Credit Unions mentioned above and also looking at existing regulations to see how they apply to mobile banking.
On March 22, 2013, the Consumer Financial Protection Bureau (CFPB) finalized an amendment to Regulation Z, which implements the Truth in Lending Act, so that the limitation on the total amount of fees that a card issuer may require a consumer to pay with respect to a credit card account stands at 25% of the credit limit during the first year after account opening. Regulation Z previously stated that this limitation applied “prior to account opening and during the first year after account opening.”
The final rule is in response to a federal court ruling issued last year that granted a preliminary injunction to block a part of the Federal Reserve Board’s (Board’s) 2011 rule from taking effect. The blocked part of the rule extended the fee limitation to include fees incurred prior to the opening of the credit card account. The authority to implement the Card Act has since transferred from the Board to the CFPB. The CFPB issued a proposal last year to amend the rule to be consistent with the court ruling, which they have now finalized.
Michigan credit unions are committed to youth financial education and we’ve been able to show that primarily through reporting totals gathered by the National Youth Involvement Board (NYIB) and CUNA. Through this reporting we can see that historically, Michigan credit unions are engaged in youth financial education more extensively than any state in the nation. During the last school year, Michigan credit unions reported to the NYIB that they conducted 2,001 financial education presentations reaching 46,976 youth. And, as reported to CUNA, 59 Michigan credit unions operate 395 student credit union branches in the state. The actual numbers are likely even larger as some activities go unreported.
The Michigan CU Foundation is now accepting applications for scholarships for the 2013 CUNA Management School that will be held in Madison, Wis., from July 14-26. These scholarships are awarded annually to encourage the development of professionals committed to serving in the credit union system.
Michigan lawmakers will be meeting with representatives of Michigan's 4.5 million credit union members during the MCUL & Affiliates Governmental Affairs Conference, taking place this week, April 9 & 10 in Lansing.
MCUL & Affiliates is getting ready to launch another round of the guided financial counseling training and certification program that combines the lower cost and convenience of a CUNA self-study program with the valuable group hands-on learning and networking of an off-site training school. This popular training program has been attended by 239 Michigan participants in the past three years and is used in a variety of ways to help members build a strong financial future. Using CUNA’s Financial Counseling Certification Program, participants completing the course will become Certified Credit Union Financial Counselors (CCUFC) with the skills and knowledge to help guide members in personal money management principals. Funding from the Michigan Credit Union Foundation will again bring the NCUF’s REAL Solutions enhancements to Michigan; with live group sessions to provide hands-on training and bi-weekly group conference calls to supplement the modules. Full details and registration information can be found here. For more information contact MCUL & Affiliates Financial Education Manager Beth Troost at firstname.lastname@example.org or by phone at (800) 262-6285, ext. 453.
Chairpersons of MCUL & Affiliates chapters have until April 25 to contact email@example.com with the names of up to four eligible participants from their chapter who have been selected to receive complimentary admission to the League's 2013 Annual Convention and Exposition, taking place May 16-18 at the Detroit Marriott at the Renaissance Center.
The AC&E is packed with training and networking opportunities and features an exposition with over 100 exhibitors. To view the full agenda and information about keynote presentations, general sessions and the amazing line-up of speakers, click here.
Edsel and Eleanor Ford House in Grosse Pointe Shores
Plenty of fun social activities are planned at this year's MCUL & Affiliates Annual Convention and Exposition, providing attendees outstanding networking opportunities and offering unique experiences for guests who join participants at the popular conference.
The Detroit Renaissance Center is home to great shopping, restaurants and a movie theater, and offers access to a Detroit People Mover station and a connected walkway to the Millender Center and more shopping, without needing to step outside. Be sure to read more here about activities included in registration categories and which select events require additional tickets. Attendees are highly encouraged to book hotel rooms by April 24 here. Complete details about the conference and event agenda can be found by clicking here.
Now more than ever, every credit union needs to continue to reassess their collections function to make sure they are getting the most from their limited resources and maintaining an effective collections process. In conjunction with the Collections Consortium, MCUL & Affiliates is hosting two Collector's Training Schools next month, and those who register soon can save on registration.
What do low-wealth families and Americans preparing for retirement have in common? Both have a need for financial services to help them move forward in their financial lives. During a simulation event presented by the Michigan Credit Union Foundation and facilitated by NCUF's REAL Solutions on Wednesday, May 15, attendees will come to understand the specific needs of members in these groups by participating in an experiential learning activity to help them better empower members to thrive financially.
A webinar focused on the Consumer Financial Protection Bureau's Overdraft Services Update, Remittance Transfers & Payday Lending will be offered April 11 from 1-2:30 p.m. (ET). Attorney Rob Rutkowski will cover the impact of CFPB on overdraft programs, Reg E updates on disclosure rules for remittance transactions and new requirements related to payday lending. The webinar is priced at just $129 per connection, which includes a complimentary archive that may be downloaded, saved and shared with colleagues. To learn more and to register, click here.
Employers of all sizes will be impacted one way or another by health care reform beginning in January 2014. But groups with 50+ employees are most at risk for compliance issues and penalties.
Registration is open for the 19th annual Michigan Credit Union Charity Open golf outing at 9 a.m. on May 15 at The Inn at St. John’s in Plymouth. This kick-off event for the 2013 Annual Convention and Exposition is a great time for board members and credit union staff to network and enjoy a day on the golf course.
Registration is open to the first 144 registrants only, and you must register before the deadline of April 15. Cost is $200 per golfer, and includes 18 holes of golf, cart, drink tickets, lunch and an awards dinner. The Michigan CU Foundation and Children’s Miracle Network will receive the proceeds of this event.
During registration there will be a continental style breakfast beginning at 9 a.m.
Each week, MCUL Public Affairs adds new links to the Press Room area of its website featuring credit union media coverage in a variety of formats statewide and nationally. If your credit union has been featured in the media, let us know. Email a link to Mona.Shand@mcul.org.
The latest articles are kept in the Press Room , but other clips are still available in the archive.
CUBE TV is the MCUL's online video portal, with regular updates of topics and information for CUs: http://mi.cubetvonline.com/cubetv/
...A webinar on the Top 10 Potentially Profitable Products of 2013 will be hosted April 23 from 1-2 p.m. (ET) with Shari Storm, a former member of Filene's prestigious i3 team. She will take a look at some new and a few not-so-new products that could be earning credit unions a revenue stream in the coming year, identifying ten products that should be on the radar. The session is priced at $169 per Internet connection, which includes a complimentary archive. To learn more or to register, click here.
Easter Bunny with happy egg hunters at Huron Valley Egg Hunt
… Genisys CU was the presenting sponsor for the annual Huron Valley Egg Hunt, which took place at Duck Lake Pines Park in Highland.
The event, hosted by The Huron Valley Chamber of Commerce, attracted several hundred children from the Huron Valley School District along with their parents. Families were able to visit the Easter Bunny, have their face painted, and participate in multiple kids activities.
“It’s great to see how excited the kids are when we start the Egg Hunt,” said Laura Bolyard, events manager at the Huron Valley Chamber of Commerce.
This is the fifth year that Genisys CU has been the presenting sponsor of the Egg Hunt.
“This is one of the many wonderful events that Genisys sponsors for the children,” said Jackie Buchanan, President/CEO. “We are glad to be a part of something that brings smiles to many children in the Huron Valley community.”
For more information on how you can become involved with this event, please visit the Huron Valley Chamber of Commerce website at www.huronvcc.com.
Marshall Community CU employees participating in the Oaklawn Hospital Benefit Auction. Back row left to right: Jan Buskirk & Katie Schook; Middle row left to right: Lori Burcaw & Julie Zink; Front row left to right: Patti Bergstresser, Maxi Rhodes and Nicole Thomas
… Seven representatives from Marshall Community CU recently volunteered their time at the 23rd annual Oaklawn Hospital Benefit Auction. MCCU’s Vice President of Members Service Patti Bergstresser and Branch Manager Nicole Thomas also served as finance co-chairs on the steering committee. Other MCCU volunteers worked at the finance table during the night long event.
Since its inception in 1991, the Oaklawn Auction has raised about 1.4 million dollars for the hospital.
…Senior Health Partners were awarded a $1,000 OMNI “Gives Back” grant by OMNI Community CU. The grant was used for a Santa Sock Hop, held in December 2012. The event was free to 250 elderly, low income, at risk seniors in Calhoun County and included a meal, entertainment and dancing.
“We are overjoyed to have provided this grant for Senior Health Partners. They put on a lovely event for seniors in our community who might otherwise spend the holidays alone,” said OMNI CEO Ted Parsons.
Linda Grap, director for Senior Health Partners, said, “We are fortunate to live in a community that cares about our older adults and are especially grateful to local businesses like OMNI Community Credit Union who believe in giving locally.”
OMNI is now accepting applications for the grant program and has committed to provide $50,000 in grants in 2013. To apply visit www.omnigivesback.org.
Teller, Honor CU, Plainwell
Account Specialist, Honor CU, Paw Paw
Programmer, Bay Winds FCU, Charlevoix
Teller, Honor CU, Niles
Part-Time Teller, Security CU, Owosso
Member Service Representative/Loan Officer, Consumers CU, Holland
Lending Manager, Filer CU, Manistee
Part-Time Teller, Alliance Catholic CU, Sterling Heights and Troy
Compliance Specialist II, Educational Community CU, Kalamazoo
Part-time Teller, Rogue River Community CU, Sparta
Collector, Bay Winds FCU, Petoskey
Assistant Vice President, Michigan First CU, Lathrup Village
Human Resources Manager, Michigan First CU, Lathrup Village
Branch Manager, Grand Valley Co-Op CU, Grand Rapids
Part Time Accounting Clerk, Community Choice CU, Farmington Hills
Submissions to Monitor should follow the submission guidelines and may be emailed. Shawn Glinis is the editor of Monitor and can be reached at 800-262-6285, ext. 449. The newsletter of the Michigan Credit Union League is published Monday mornings or Tuesday mornings when Monday is a holiday. There is no Monitor the week after Christmas and the week after the Annual Convention and Exposition. MCUL reserves the right to edit submissions for clarity and space.
Subscribe to the Michigan Monitor at www.MCUL.org/MonitorSubscription