NCUA Clears National Trust Bid
ALEXANDRIA, Va.-NCUA gave its approval to Suncoast Schools FCU to initiate formal plans to create a national trust company, which would be the first national trust owned and operated by a credit union.
Under the plan, Florida's largest credit union would establish a CUSO which would be chartered as a trust-only thrift by federal regulators at the Office of Thrift Supervision and the deposits would be insured by the FDIC.
The $3-billion credit union said earlier it will develop the new company, called MEMBERS Trust Co., in partnership with CUNA Mutual Group, which other credit unions will be invited to invest in.
Suncoast Schools FCU currently operates a state-chartered trust company, called Suncoast Members Trust Co., which would be converted into a national trust under the plan.
Calif. Adopts Risk-Based Exams
SACRAMENTO, Calif.-The state Department of Financial Institutions said it will implement a risk-based examination system for all state- chartered credit unions next year.
The risk-based system, which is being modeled after NCUA's program, will focus on a credit union's current and potential risk for interest rates, credit, liquidity, reputation, transactions, compliance and strategy.
DFI examiners will be trained by examiners from NCUA and Iowa, which recently enacted their own risk-based exam programs.
Florida CUs Eye Public Deposits Law
TALLAHASEE, Fla.-Florida credit unions are expected to lobby state legislators next year to amend the state statute to enable state agencies and municipalities in the Sunshine State to deposit funds in federally insured credit unions.
A recent legal opinion letter provided by NCUA to the Florida CU League cleared federally insured credit unions to accept municipal deposits.
Aletta Schutes, chief lobbyist for the state league, said she expects the issue to create a major legislative battle as banks and thrifts try to maintain their hold on municipal deposits.
"I've been waiting for this legal opinion for nine-and-a-half years," she told The Credit Union Journal. In an Oct. 4 legal opinion, NCUA told Shutes the agency has reconsidered its long-standing policy on the issue and believes that its recently adopted incidental powers rule will allow federally insured credit unions to accept public deposits.
Funds Keep Flowing Into CUs
MADISON, Wis.-Credit unions added another $700 million in new savings in September, making a total of $40.6 billion in new funds that have flown into credit unions through the first nine months of the year, according to CUNA.
The brunt of the new savings was in retirement accounts, which grew by 2.2% in September, and in money market accounts, which expanded by 0.9%.
The hot mortgage market continued to carry credit union lending, with fixed-rate mortgages expanding by 1.4%, other mortgages by 1.3% and adjustable-rate mortgages by 0.9% during the month.
Additionally, auto lending cooled during September, with portfolios for used cars growing by just .3% and new car loans portfolios declining by 0.1%.
CUSO Signs New Clients
PORTLAND, Ore.-CU Business Group, a new CUSO formed by Northwest Corporate CU and FirstCorp FCU, has signed four new credit union clients: Fibre FCU, U Lane O CU, Point West CU and White River CU.
The credit unions signed for the CUSO's business loan, deposit and consulting services. The new CUSO is tapping in on credit unions' increasing interest in member business lending and other business services. CU Business Group said it has more than $2 million in MBLs currently in its pipeline.
Korean CU Movement In Meltdown
SEOUL, South Korea-After announcing the shut down of 115 credit unions, government regulators said members with less than 5 million won ($4,108) at ailing credit unions will be given priority compensation by the Korea Deposit Insurance Corp.
Members who urgently need money will be able to take out loans backed by their deposits, the government said, adding that it has organized 10 task forces to speed up compensation claims which it aimed to complete within this year.
Korea's Financial Supervisory Service suspended operations at 115 credit unions, 10 percent of the nation's total, after they sustained losses larger than their combined capital.
The nation's continuing banking crisis has claimed more than 400 credit unions over the past five years.
Trial Moved In Brutal CU Slaying
EL PASO, Texas-The trial in the vicious murder of an El Paso Government Employees CU member two years ago was moved to San Antonio after more than 140 potential jurors said they could not render an impartial verdict.
The suspect, Michael Jacques, 25, is charged with capital murder in the March 2000 slaying of 18-year-old high school senior Sophia Martinez, who was assaulted at she was making a routine withdrawal at the credit union's drive-through ATM at 10:20 p.m., then raped and murdered and her body discarded at an abandoned field outside of the city.
Twenty-three-year-old William Berkley was convicted of capital murder in the case last April and sentenced to death. County prosecutors said media coverage of the case caused the judge to agree to a change in venue.
Spokane Teachers CU Converts Check Printing Vendors To Deluxe
SPOKANE, Was.-Spokane Teachers CU said Monday it switched check printers to Deluxe Corp.
Under the deal, Deluxe Corp., the nation's leading check printer, will provide check reordering options and business referral services.
New CU Group Offers Office Discounts
FEDERAL WAY, Wash.-The CU Association of the West said it has reached an agreement with Boise Office Solutions, a unit of Boise Cascade, to offer discounts to credit unions on office supplies, technology, furniture and paper to credit unions in California, Nevada, Oregon and Washington.
The new group, which has signed discount pacts with Centrix Financial and Clarke American, is an umbrella organization owned by leagues in those states.
Teen Robbery Accomplice Gets Light Prison Term
RAPID CITY, S.D.-An 18-year-old man was sentenced to 30 months in jail last week for his role in last May's hold-up at Dakota Star CU.
Christopher Hoffman was also ordered to pay $2,500 in restitution. Hoffman's partner, 22-year-old James Morgan, was sentenced earlier in the week to 10 years in prison for carrying a gun during the heist.
Branch Manager Confesses To Embezzlement Scheme
WHITE PLAINS, N.Y.-A former branch manager at Matteawan FCU pleaded guilty in federal court here last week charges she embezzled more than $150,000 from the credit union.
Theresa Palumbo, 41, of Wappingers Falls, admitted to diverting $140,00 in checks paid to the credit union to her own use and used the credit union's Visa card to make almost $12,000 in purchases. Sentencing is scheduled for Jan. 31, 2003.
