Lscu directors newsletter q1 march 21 finalb

League of Southeastern Credit Unions & Affiliates

Director’s Resource League of Southeastern Credit Unions

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March 2014 | Vol. 5 Issue No. 1

President’s Message We’ve had a great first quarter on our advocacy efforts. Ways and Means Chairman Dave Camp (R-MI) recently released tax reform language and our tax exemption was preserved. This is a major victory for credit unions. Our collective efforts really did make a difference.

The past ten months have been uncertain for all of us. Our tax exemption was being looked at as a tax option for quite a while. The League formulated a month-by-month plan to contact our lawmakers asking them to “Don’t Tax My Credit Union.” We generated more than 126,000 contacts to Congress making our two states one of the most active in the country. We introduced the “Don’t Tax My Credit Union” postcard campaign and all of you ran with it. We delivered more than 85,000 to our lawmakers.

Also in February, the U.S. House passed H.R. 3193, The Consumer Financial Protection Safety and Soundness Improvement Act, which provides greater authority to the Financial Stability Oversight Council (FSOC) to stay or set aside rules promulgated by the CFPB if they would have an adverse impact on the safe and sound operations of financial institutions. The legislation also requires the CFPB to take into consideration the impact of its rules on insured depository institutions.

These are two good victories for credit unions. We should feel good about how our collective grassroots efforts have paid off.

Thank for the hard work you perform for your credit union.

What CEOs Genuinely Need From Their Boards

by Jeff Rendel, CSP, president, Rising Above Enterprises Much has been said and written about board governance and CEO oversight. But what about the say-so at the other end of the board table? What do CEOs really need from their boards? We asked CEOs: “What can your board do to become a real strategic asset?” Distinctively situated, CEOs gave this shared guidance for boards.

1. Learn the credit union business.

It’s a simple tenet: No one should agree to take a director position unless he or she is prepared to comprehensively study for boardroom dialogues. Beyond reading the board packet before board meetings, directors should make certain they comprehend the moving parts of the credit union and stay up-to-date about industry changes. An education plan (and budget) for the full board and each director is helpful, as well as a brief educational presentation every few board meetings. Several CEOs believed that their exchange of ideas with their boards was much better as the full board took the time and effort to study the credit union. (continued on page 2)

Save the Date FCUA GAC March 25-26 Tuesday - Wednesday Tallahassee, FL Click here for more information Directors Series: How the Board Can Protect your CU April 30 Wednesday Webinar Click here for more information Board Versus Supervisory Committee May 13 Tuesday Webinar Click here for more information

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2. Accept matter-of-fact, entrepreneurial endeavors.

Perhaps lessons learned over the last several years or aversion to risk that sometimes grows with the size of the credit union caused the desire for risk to be lopsided.

CEOs noted that growth in the past came as a result of boards supporting aspiring ventures. CEOs also insisted that maximizing the long-term, sustainable value of the credit union best represents the interests of members. A meaningful debate about business issues and possibilities is what CEOs wanted most.

3. Productively examine strategy.

Not one CEO said, hinted, or implied that he or she demanded lockstep approval of their strategic plans and resented pushback. Truth be told, CEOs wanted active deliberation in the boardroom. In CEOs’ views, boards performed best when they hit upon the suitable sense of balance between professional collegiality and ensuring the safety, soundness, and sustainability of the credit union.

4. Keep us encouraged.

The relationship between a CEO and his or her board is reciprocal: a CEO relies on the board for guidance just as much as the board relies on the CEO for execution. Add support and encouragement to the list of CEO “must haves.”

CEOs found much value from their boards when their boards regularly acknowledged strategic progress, success, and appropriate course adjustments along the way. The kind of encouragement that worked best with CEOs was beyond brief congratulations when a balanced scorecard metric was met. Boards that encouraged their CEOs most issued deep reassurances that current strategies and the CEO himself or herself were right, fitting, and proper for the credit union. In short, the board was confident in the strategic direction and CEO leadership of the credit union.

Boards and CEOs recognize that they and their members will get more value if the partnership at the top is strong.

The best leadership partnerships are forged where there is shared respect, active commitment to the future success of the credit union, and solid pledges of confidence. A board of great strategic value understands the credit union, establishes a balance of risk and reward, digs deep to understand the right direction for the credit union, and believes in its CEO to execute in the finest fashion.

Jeff Rendel, CSP, president of Rising Above Enterprises, works with financial services providers that want elite results in leadership, sales, and strategy.

Update to Alabama Credit Union Act passes House and Senate Alabama credit unions received a major victory this month with the passage of HB 165, the Alabama Credit Union Act Update. The legislation passed the House and the Senate and it now awaits Gov. Robert Bentley’s signature. The legislation, which was sponsored by Rep. Greg Wren (R-Montgomery), makes significant improvements to the State Act which has largely remained untouched for the past 30 years.

Some of the changes in the legislation include credit unions being given additional protections for accounts set up by minors, the fraudulent use of the term “credit union” is prohibited, allows credit unions to expel members by a majority vote of its board of directors for certain acts against the credit union or its employees, increases the liability protection for accounts of deceased members from $5,000 to $10,000, and clarifies language to allow credit unions to reimburse directors for expenses and provide appropriate insurance for the role in the credit union.

HB 165 now moves to the governor’s desk. Watch eSignal Daily for more coverage of the ceremonial signing of the bill.

Advocacy Efforts Pay Off - CU Tax Status Safe for Now The House Ways and Means Chairman Dave Camp (R-MI) released his tax reform draft in late last month, which among other things preserves the credit union tax exemption. This is a major victory for credit unions and shows the strength the League and credit unions have when they work togeather.

Rep. Camp’s draft is just that – a discussion draft.

There will be more talk and more lobbying by those adversely affected. Bankers have continued to fight to have the credit union tax exemption included even after the discussion draft was released. House leadership has said that tax reform will be a priority in 2015. The League and CUNA will continue to keep the tax status on the front burner and monitor where this language is headed. There could be times later this year and certainly next year where we will need to continue “Don’t Tax My Credit Union.”

LSCU’s Annual Convention and Exposition (AC&E) is Now the Southeast Credit Union Conference and Expo (SCUCE) The League of Southeastern Credit Unions and Affiliates’ Annual Convention and Exposition (AC&E) is getting a makeover in 2014. The League’s AC&E has been rebranded the Southeast Credit Union Conference and Expo (SCUCE). The LSCU & Affiliates is opening up the SCUCE to more than just credit unions from Alabama and Florida.

To learn more about the Southeastern Credit Union Conference, visit the SCUCE webpage.

Is Your Credit Union, CEO, or Peer Worthy of Recognition?

The LSCU is looking for good men and women that have really made a difference at a credit union, the community, and the credit union industry as a whole, as well as credit unions that are good proponents of the credit union philosophy of “people helping people” whether it’s for its members or community.

Did your credit union have a good year last year? Did it do something outstanding in the way of community involvement? Has your CEO or a member of the management team shown above and beyond efforts to advance the credit union movement whether it is in your community, your state, or the nation? Is there a young professional that has shown proven dedication and enthusiasm for credit unions? Is one of your credit union board peers someone that has served as a lifelong proponent of credit unions and has gone above and beyond the call of duty?

If you answered yes to any of the above questions, submit an entry today.

Entries and/or nominations are due to the LSCU by Friday, March 28.

Directors Spotlight Betty Petree, Pen Air FCU

Pen Air FCU’s Petree inducted in Credit Union House Hall of Leaders As the 2013 LSCU & Affiliates Distinguished Service Award winner, Pen Air FCU’s Betty Petree received a nomination into the Credit Union House Hall of Leaders. She is just one of 90 inducted. During the CUNA GAC in February, Petree received her award.

She has worked with Pen Air for more than 50 years.

“I never thought I would go this far and get this much recognition. I would encourage anyone to follow their path into the credit union because it’s such a wonderful place to advance. When I talk to our employees, I encourage them to become branch managers because that’s really where you get to understand the credit union.”

Larry Smith, Rocket City FCU

Rocket City’s Smith says its beneficial to attend CUNA GAC. “I think it’s important to come to Washington, D.C. and speak with our lawmakers. I used to work for Rep. Mo Brooks doing some investigations for him. I also spent time with Rep. Spencer Bachus when he was running for state attorney general.

Being able to meet with those I know helps since you already have a relationship and you know how to talk to them. Credit union directors should engage during the advocacy process since they have an interesting perspective that resonates with our lawmakers.”

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