Director's Newsletter Quarterly

Director’s Resource League of Southeastern Credit Unions

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June 2011 | Vol. 1, Issue No. 1

President’s Message

W

elcome to the first edition of the Director’s Resource Newsletter. The League is putting together this quarterly newsletter to keep you informed about how the LSCU and CUNA are working for you. You will also find here many resources to help you in your position as a credit union director. The newsletter will highlight learning opportunities geared specifically for volunteers from the League and CUNA, as well as articles that will enhance your growth as a credit union volunteer.

Since the newly formed LSCU debuted in January 2010, we’ve been working hard to focus on your needs. We added new positions in our Governmental Affairs department in Alabama and Florida to enhance our legislative and regulatory outreach. We’ve combined our three foundations into one and hired an executive director. This will raise the profile of our credit union development programs, scholarships and the giving arm of credit unions. The League is spending more time inside our member credit unions meeting with CEOs and staff while really listening to their concerns. I hope you are seeing the difference.

Enjoy this first issue of the Director’s Resource. I look forward to talking with many of you as I travel throughout Alabama and Florida.

Southeastern Credit Union Foundation helping Alabama tornado victims The Southeastern Credit Union Foundation (SECUF) is doing what it can to help Alabama credit unions and their staff that were affected by the April 27 tornadoes. The SECUF opened its Disaster Relief Fund to hand out grants as well as accept donations. The foundation immediately communicated with the National Credit Union Foundation (NCUF) and requested the CUAid program be initiated. The NCUF opened up its online giving portal, www.CUAid.coop, and the SECUF announced it would match CUAid donations up to $100,000. On May 27, CUAid reached $100,000 in donations so the SECUF doubled the amount raised.

The SECUF continues to distribute Disaster Relief grants to credit union staff in the hardest hit areas. To date, the foundation has given out $35,000 in grants to credit union staff from Mobile to Huntsville. The emergency grants were given to credit union employees with a promise for more aid in the future based on documented need. Another $60,000 in grant applications is awaiting more information.

The SECUF has been working to initiate programs for financial assistance to credit unions in need. The foundation is offering an LSCU Chapter community project match to Alabama credit union chapters affected by the storms of up to $10,000. This money will help chapters finish projects in their respective areas. The SECUF also donated $25,000 to the Red Cross of Alabama to help aid the many people displaced throughout the state.

Visit the LSCU Foundations page to apply for grants or to donate to the SECUF Disaster Relief Fund.

Upcoming Volunteer Events Southeast Regional Directors Conference July 17 – 20, Nashville, TN Hilton Nashville Downtown 121 4th Ave. South Nashville, TN 37201 Click here for more information LSCU Supervisory Conference July 31 – August 3 The Grand Marriott Point Clear, AL, 36564 Click here for more information

LSCU Development Conference November 1 – 4 The Grand Marriott Point Clear, AL 36564 Click here for more information

CUNA pushing CU agenda The Credit Union National Association (CUNA) has been pushing the credit union agenda hard in 2011. CUNA President/CEO Bill Cheney has been spending quite a bit of time explaining the credit union position on a number of topics including interchange and member business lending to Treasury staff.

CUNA turned up the grassroots intensity on the interchange issue.

More than 375,000 emails and calls from credit unions helped force Senate Majority Leader Harry Reid (D-NV) to allow a vote on S. 575, an amendment to delay implementation of the interchange cap. The Capitol switchboard crashed twice. The vote ultimately fell six short.

CUNA has also been working to push the member business lending (MBL) issue in Washington. Sen. Mark Udall (D-CO) introduced a bill in the Senate. In the House, Reps. Ed Royce (R-CA) and Carolyn McCarthy (D-NY) authored similar legislation. Each piece of legislation is bipartisan and looks to raise the MBL cap from 12.25 percent to 27.5 percent. Sen. Bill Nelson (D-FL) is the only senator in the country to co-sponsor the MBL and interchange legislation.

Also on CUNA’s agenda for 2011 is supplemental capital. Cheney told Alabama and Florida credit unions in January that the U.S. is the only developed country where credit unions don’t have access to this kind of capital.

Compliance Q&A Q-Why is financial literacy training now required for federal credit union directors?

A-The NCUA now requires directors to complete financial literacy training as a result of an increasingly more complex financial industry landscape. With more concern over credit union losses and the sophistication of credit union finances, the NCUA wants to ensure that federal credit union directors have a sufficient working knowledge of their credit union’s financials going forward. Current credit union directors have until July 27, 2011, to come into compliance.

The LSCU will hold a financial literacy training session at the AC&E. LSCU VP, Regulatory Affairs Bill Berg is available to hold training sessions to bring your credit union directors into compliance before July 27.

Q-Why do directors need to obtain annual training on Bank Secrecy Act regulations (BSA)?

A- BSA Regulations require annual training for all staff and management.

Although directors do not exercise day-to-day control of a credit union, they do provide direction for the credit union and part of that direction is an understanding of BSA regulations. If management recommends additional resources (staff and/or software) for compliance with BSA regulations, the board must understand enough about these regulations to make an informed decision that helps the credit union to meet its compliance obligations. The training that is required for directors does not have to be as detailed as it is for other staff (especially those with primary BSA responsibilities), but it needs to provide a solid overview.

The LSCU provides multiple opportunities for BSA training. Check the Education Calendar at www.lscu.coop for dates/times.

For compliance questions, call the LSCU Compliance hotline at 866.231.0541.

Image Campaign nearing $1 million mark The LSCU Statewide Image Campaign is set to kick off this fall.

The League has been educating credit unions on the benefits of a cooperative Image Campaign while also fundraising. More than 80 credit unions from both states are taking part with the total contribution approaching $1 million. The LSCU, through the League Service Corporation LEVERAGE, contributed the first $100,000.

Over the past nine months, the League has been talking with credit unions across Alabama and Florida about the campaign while getting the creative produced.

The TV ad will debut at the LSCU Annual Convention and Exposition (AC&E), plus an Information Lab will be set up at the AC&E for credit unions to get more information about the campaign.

The TV ad features an actor talking directly to the camera wondering why “60 percent of you don’t know what a credit union is.” The ad contrasts that to not knowing what “chocolate tastes like or what a hug feels like.” The actor tells the viewer that “being a member of a credit union is like finding money every day.” The ad ends with the tag line “Credit Unions: we’re giving banking a better name.” Banking is used as a verb and not an attack on banks.

Fundraising for 2011 will wrap up at the end of June. If your credit union would like more information on the Image Campaign, contact LSCU VP, Communications and Marketing Mike Bridges at 866.231.0545, ext. 1022.

PAC fundraising builds relationships PAC fundraising plays a major role in advocacy. Candidates that understand credit union issues are identified during election years. This is important because building relationships with policy ensures that the credit union message is heard.

Last year the LSCU PACs raised $414,000 and contributed $1.1 million to credit union-friendly candidates in the last election cycle. After the election, more than 80 percent of those elected were backed by credit unions. Contributions to the LSCU PAC give credit unions a voice on the local and national levels.

Candidates supported by the League’s PACs are better educated on credit union issues and more likely to introduce and support legislation that affects credit unions positively.

The League has a PAC fundraising brochure available to credit unions on the LSCU website under the Grassroots Advocacy tab. Contact LSCU Grassroots and Political Action Coordinators Robbie Gordon (AL) at 866.231.0545 ext. 2164 and Andy Gonzalez (FL) at 866.231.0545 ext. 1010.

Johnson named ‘LSCU Volunteer of the Year’ The League of Southeastern Credit Unions recently named its award winners for 2010, with Pen Air Federal Credit Union Chairman Maurice Johnson receiving the 2011 Volunteer of the Year.

Johnson has been a member of Pen Air since 1965, serving on the supervisory committee and the board of directors for more than 30 years. For the past seven years, Johnson has served as chairman. He is active in political affairs and makes a trip to Washington, D.C. every year to promote credit unions. Johnson is also active in the chapter by attending all chapter meetings as well as other major credit union conferences. His influence has helped Pen Air FCU earn the 5-star superior rating from Bauer Financial for 81 consecutive quarters as of March 2011.

“A big thanks goes to all of the people who helped me,” Johnson said.

“You can’t do it by yourself. I want to thank my wife, the other volunteers and the staff, and all of the employees who helped me get this. And I also want to thank the League for the opportunity.”

Johnson will receive the Volunteer of the Year award at the LSCU’s Annual Convention and Exposition Closing General Session June 18 in Orlando, FL.

Volunteer Spotlight Each quarter the Director’s Resource will feature a volunteer or volunteers talking about serving on a board of directors, the role of the board, or a hot credit union issue.

In this edition Sal Marino and Jack Wisdom from APCO Employees Credit Union, based in Birmingham, answer a question. They each have been on the APCO board for more than 50 years. They met on their first day of work at the Alabama Power Company about the same time they began volunteering at APCO.

Jack Wisdom

Sal Marino

How do you feel about being a non-paid credit union volunteer for all these years?

Strong board governance can lead to a stronger credit union

S: Never thought about being paid. We love the fellowship of credit union people; everyone at the credit union is part of the family.

Even though the economy is improving, it’s still affecting members, which in turn affects credit unions. The regulatory burden is continually increasing, making it critically important that credit unions have a strong board of directors in place. As unpaid volunteers, credit union directors are charged with setting the policy for the financial institution, as well as being part of the public face of the credit union.

S: We are part of one of the best credit unions (APCO) in the country. We’re proud to have been part of it in its infancy and now as it has grown to $2 billion in assets.

Credit union CEOs are always working with their boards trying to refine the process of helping them to be as successful as possible. Here are a few areas that will help boards to be more efficient and make better decisions: •

Setting the policy for the organization (approving strategic plans)

•

Monitoring the organization’s operations (hiring, evaluating, and working with the CEO, approving annual budget/report) Serving as a public figure for the organization (advocating for credit union)

• •

Fulfilling other board responsibilities (documenting policies and decisions, preparing for and attending board meetings, researching and discussing issues, replacing and orienting board members when a vacancy arises)

For a credit union board, having a vision, a plan, and working with the CEO will spell success. Take your position as a board director serious and the outside influences like the economy or regulatory burdens will not undermine the strength of your credit union.

J: We’ve enjoyed it…it’s something we didn’t mind doing; better in some aspects. And we’ve been all over the world for credit union conferences.

Leave a comment or suggestion on the Volunteer Spotlight by emailing submissions@lscu.coop.

LSCU Disaster Recovery Conference Recent natural disasters, accidents, and attacks have directly disrupted business operations and shown that an organization’s resilience to a disaster and ability to resume business is directly related to it’s preparedness to respond to unforeseen events. Having a definitive response plan is essential to remain viable, especially in today’s rough economic climate.

July 12-13, Pensacola, FL Hilton Pensacola Beach Front Click to learn more and register

To receive the latest news from the LSCU, CUNA and the NCUA sign up for the League’s weekly newsletter, eSignal, at www.lscu.coop. Director’s Resource publisher – Joseph Davis (joseph.davis@lscu.coop)