LSCU Director's Resource Newsletter 3Q

Director’s Resource League of Southeastern Credit Unions

|

September 2011 | Vol. 1, Issue No. 2

President’s Message

T

he third-quarter edition of the Director’s Resource Newsletter hits your inbox at the time credit unions boards are planning for 2012. We have included an article on when our re-affiliation packet will be mailed out. The article highlights a few of our accomplishments in 2011. The re-affiliation brochure will show a greater picture of how we have been working for you this past year. Our $1.3 million image campaign is an example of bringing credit unions together to collectively raise the profile of the movement. Many of you have told me on my credit union and chapter visits that a campaign is long overdue.

This edition highlights how CUNA President/CEO Bill Cheney has been making an impact in Washington, D.C. We saw some of CUNA’s efforts when we held our annual Hike the Hill Sept. 19-21. Many members of Congress were already up to speed on the member business lending (MBL) issue. In fact, Reps. Kathy Castor (D-FL) and Allen West (R-FL) signed on to co-sponsor H.R. 1418 while we were there. A handful of our delegation expressed interest to also sign on. We are aggressively following up with them. House Financial Services Chairman Spencer Bachus told the Alabama delegation a subcommittee hearing on MBL legislation will take place Oct. 12.

I hope you will mark your calendars to attend some of the grassroots lobbying opportunities we have in 2012. We are seeing positive results for our efforts. Thank you for your service to your credit union.

Why Your Credit Union Should Not Focus Solely on CAMEL Ratings This past June, LSCU President/CEO Patrick La Pine talked to a gathering of NCUA Region III examiners. A topic of conversation during the gathering centered on the fact that some credit union boards look at performance of the CEO in relation to the credit unions’ CAMEL rating.

While a credit unions’ CAMEL rating has been around for 25 years, the NCUA phased out the CAMEL Matrix in 2008 so credit unions would focus on the broader risk.

CAMEL ratings look at a credit union’s capital, asset quality, management, earnings, and asset liability management. The lower the ratings, a one as opposed to a five, are preferred. However, credit union boards should keep in mind that sound risk management requires the board to establish and measure the credit union’s and management’s performance based on internal goals and objectives, rather than CAMEL ratings. Staying focused solely on CAMEL ratings could open the credit union to more risk.

Most credit unions have taken a hit in this tough economy. CAMEL ratings can fluctuate based on certain factors within the goals of that credit union. All credit unions do not have identical risk profiles or business models. To ensure success for a credit union CEO, a board needs to determine a realistic strategic plan that is based on the unique business model that the credit union is operating under. By getting away from a focus on CAMEL ratings, a board can focus analysis on management’s evaluation and control of risk rather than predetermined benchmark performance.

Save the Date LSCU Development Conference November 1 – 4 The Grand Marriott Point Clear, AL 36564 Click here for more information Florida GAC January 24-25, 2012 Tuesday – Wednesday Hotel Duval - Tallahassee, FL Click here for more information CUNA GAC March 18-22, 2012 Washington, D.C. Washington Convention Center Click here for more information Alabama GAC April 4-5, 2012 Wednesday – Thursday Renaissance Montgomery Hotel & Spa Click here for more information

LSCU Development Conference Offers Star-studded Lineup

$1.3 Million Image Campaign Hits the Air

The 2011 LSCU Development Conference offers credit unions an impressive lineup of speakers. CUNA President/CEO Bill Cheney and Consumer Financial Protection Bureau Assistant Director of Community Banks and Credit Unions Elizabeth Vale will headline the conference.

Cheney will update credit unions from a national perspective. Vale offers a rare opportunity for credit unions to interact with the newly formed Consumer Financial Protection Bureau.

As you read this newsletter, the LSCU Statewide Image campaign is running across 14 media markets in Alabama and Florida.

With $1.3 million raised, it is the largest voluntary credit union cooperative advertising campaign in the country. One hundred credit unions across both states are participating.

The conference also features NCUA Region III Director Herb Yolles and Filene Research Institute Chief Research Officer George Hofheimer.

The education sessions include topics like Asset Liability Management for Directors, CEO and Board Succession Planning, Understanding Audit Reports, The Importance of Advocacy, and a Small Asset Sized Credit Union Roundtable. For golfers, there is an outing to benefit the Children’s Miracle Network on Nov. 2.

The beautiful Grand Hotel Marriott Resort, Golf Club & Spa provides the backdrop for the 2011 LSCU Development Conference.

November 1-4, Point Clear, AL Grand Hotel Marriott Resort, Golf Club & Spa Click here for the agenda and to register

The campaign, which utilizes the tag line “Credit Unions: We’re giving banking a better name,” is geared toward Gen. X. The media buy reflects the target audience: TV, radio, billboards, online, and social media. Consumers are directed to www. betternameforbanking.com where they can see how much a credit union would save them on products like a mortgage, auto loan, or credit card. There is a search function that populates with the credit unions that participate in the campaign.

The 2011 campaign is the start of what the League hopes will be a sustainable long-term cooperative advertising campaign.

Pre- and post-campaign research is being conducted by SIR out of Richmond, Virginia. The research, along with campaign analytics, will be presented to credit unions later this year as part of the fundraising efforts for the 2012 campaign. The next set of media buys will come in the spring of 2012. If you have questions, contact LSCU VP, Marketing and Communications Mike Bridges at 866.231.0545, ext. 1022.

Contributing to PAC, Contributing to Your Credit Union’s Future This past year reminded us how important advocacy is for credit unions, having faced battles in both the state legislature and U.S. Congress.

While advocacy and grassroots efforts help people hear the credit union voice, unfortunately, that is only half the battle. Political fundraising is the other half, and is becoming increasingly more important every year.

Already this year, LSCU PACs have contributed to the campaigns of several credit union-friendly candidates for the upcoming election cycle. The LSCU is confident that its proven track record of success in selecting candidates to support will continue, and your support is essential. Contributions to LSCU PACs give credit unions an opportunity to define their own message at the Captiol, both on the state and federal levels. PAC contributions afford the League an opportunity to educate lawmakers on issues that are important to the credit union industry.

Through your contributions, the LSCU can proactively push legislative changes that positively affect credit unions.

Credit unions in Alabama and Florida have been actively participating in PAC fundraising programs, in both credit unions and credit union chapters. Programs such as payroll deduction, “deduct-a-buck,” candy bar sales, theme park ticket sales, and jeans days have been some of the most effective ways for credit unions to contribute to the PAC. Innovative PAC fundraising programs offer an easy way for employees and members to contribute while also participating in a fun incentive or service within their credit union.

Consider contributing to the LSCU FEDPAC, ACULAC, or CUPAC today by contacting LSCU Grassroots Coordinators Robbie Gordon (Alabama), 866.231.0545, ext. 2164 or Andrew Gonzalez (Florida), ext. 1010 to make your contribution today.

CUNA’s Cheney on List of ‘Top Association CEOs of 2011’ CEO Update, a highly regarded Washington-based newsletter for association and nonprofit executives, came out with its “Top Association CEOs of 2011” issue, and their list includes Credit Union National Association President/CEO Bill Cheney. CEO Update said of Cheney: “In just his first year as CEO of CUNA, he gets credit even from adversaries for nearly scoring a major upset in the debit-card swipe fee battle. Retailers had gotten a limit to the fees included in the Dodd-Frank financial overhaul. The Federal Reserve, interpreting the new law, initially proposed setting the limit at a fraction of the going rate.

At a time when big banks were less popular than, say, Congress, Cheney’s stepped up advocacy efforts, and huge grassroots mobilization of credit union members helped persuade many lawmakers who had supported the fee limit to vote in June to delay it. Proponents of the delay fell just short of the 60 votes needed in the Senate. But their show of strength among lawmakers and thousands of comments to the Fed likely influenced the central bank, which substantially raised the fee cap, essentially splitting the difference between what retailers and financial interests wanted.”

Re-affiliation Packet to be Mailed in November This summer the LSCU Members Survey showed some amazing numbers.

When credit unions were asked about their satisfaction with the League, 92 percent indicated their satisfaction improved or stayed the same. When asked if the realization of the merger between the Alabama and Florida Leagues were being recognized, 89 percent of credit unions said it is.

These numbers show improvement from 2010, but they also show that the League is following through on its promises.

During the merger process, the LSCU President/CEO Patrick La Pine told credit unions that the new League would run more efficiently. That is being realized with more than $800,000 being saved through a leaner, streamlined company. That money is being reinvested back into credit unions through increased services like the $400 voucher for credit unions under $35 million in assets. The voucher can be used for any LSCU, CUNA, or LEVERAGE product or service. The League also offers scholarships for credit unions who wish to attend educational events. To date, $25,000 has been awarded to credit unions through the scholarship program.

Through August, the LSCU has made 700 face-to-face visits with credit unions in both states. The League is making a greater effort to be visible to credit unions and to also listen to them. The survey showed that 98 percent of credit unions feel that the League staff is responsive and professional. The League is working closer with credit unions to give them more time with their state and federal regulators to talk about issues, and more opportunities for grassroots lobbying on the state and federal level.

The members survey results show that more credit unions are seeing the difference with the new League.

A pre-dues letter was sent to credit unions in September for planning purposes. The LSCU re-affiliation materials will be sent to credit unions the second week of November. This will include the dues statement. Contact LSCU VP, Cooperative Initiatives Laura Vann at 866.231.0545, ext. 2181 with any affiliation questions.

LSCU Supervisory Conference Wrap-up The League’s annual Supervisory Committee Conference was held July 31- Aug. 3. There were 33 participating credit unions in attendance.

Highlights and topics included: NCUA updates, a Supervisory Committee 101, Assessing Risk, Economic Updates, Understanding Financials, BSA Training for Volunteers, Testing Your Disaster Plan, and “Capturing the Essence of Excellence.” In addition, attendees were able to enjoy a variety of speakers, as well as roundtable discussions with peers to share best practices and experiences with other committee members.

When asked what was the best thing about this year’s event one attendee said, “the variety of speakers were interesting, informative, and helped me think about my responsibilities as a Supervisory Committee Member, and how to be better in helping the credit union.”

L to R: LSCU Member Relations Specialist David Lenoir and Javier Ramos from Redstone FCU.

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, Ed Teller from Jax Federal Credit Union talks about his role as a volunteer, and why it’s important. Ed has volunteered for JFCU for 34 years.

Q: Why is it important for people to be involved in volunteering at their credit union?

“It provides a way for people to help others, and belong to a good cause. Volunteers should attend as many educational training sessions as possible. It provides the education and networking with other credit union volunteers that give you the feeling of being a part of a great cause.”

Q: How has your credit union handled the changes in the economy?

“We have suffered great losses but are on the road to becoming a strong credit union again. We are going into direct lending and some business loans, as well as a limited real estate exposure. As a retired accountant and prior NCUA examiner with credit union audit experience, we (the Supervisory Committee and Internal Auditor) performed the Supervisory Committee audit in 2010 thereby saving $23,000 in CPA fees. Executive management volunteered to a 10 percent pay reduction during the year 2010, and other expenses were reduced in order to improve our return on assets (ROA). Our credit union regained its 2 rating by NCUA this year as a direct result of these actions.”

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

LSCU and CUES Partner for More Educational Offerings The League and the Credit Union Executives Society (CUES) are partnering to enhance education and training for Alabama and Florida credit unions. The partnership provides credit union CEOs, executives, and directors more robust LSCU educational offerings as well as new jointly branded and executed events.

CUES will help enhance the LSCU’s current education calendar by providing curriculum and content expertise through a consulting agreement. The first event will be the Credit Union Executive Dialogue Feb. 2-3, 2012, in Florida. The Dialogue is geared toward large-asset sized credit unions’ CEOs and their senior management.

LEVERAGE, the LSCU’s service corporation, will provide expertise on business topics such as compliance and e-purchasing. The Center for Credit Union Board Excellence (CCUBE), Powered

by CUES, will benefit as the LSCU and LEVERAGE will provide resources to CCUBE to help enhance learning opportunities for volunteers and CEOs.

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)