Pentagon FCU Piloting CFPB's Simpler Disclosures
CLEVELAND-The Consumer Financial Protection Bureau is testing a prototype credit card agreement at Pentagon Federal Credit Union that is designed to use simpler, plain language so that consumers have a better understanding of the terms. According to the CFPB, the new agreement has approximately 1,100 words, significantly fewer than the average card agreement, which as five times as many, and is an outgrowth of the agency's "Know Before You Owe" project.
A prototype of the new credit card agreement can be found at www.consumerfinance.gov/credit-cards/knowbeforeyouowe/. The agency said the new draft credit card agreement has an easy-to-read layout and is organized into three simple sections: costs, changes, and additional information.
Pentagon FCU has more than one-million members, 350,000 of whom are cardholders. The $15.8-billion PFCU is one of three credit unions large enough to fall under the supervision of the CFPB.
MECU, Guardian, WDCU All
Announce Bonus Dividends
BALTIMORE-Several more credit unions announced bonus dividends last week. MECU here said it will pay its members a loan interest rebate of $1.139 million, or 6% of the interest paid on loans between June. 25 and Nov. 30 of this year. MECU said it also plans to pay an extraordinary dividend on deposit accounts at year end. The latest loan interest rebate and bonus news are in addition to the $2 million bonus the credit union paid members at mid-year. In Montgomery, Ala., Guardian CU announced it was paying a bonus of $750,000 to its members, with one member receiving $3,100. And in Williamsville, N.Y., Western Division CU paid bonus to members of $800,000.
Large Banks Close Gap With
CUs On 'Satisfaction' Rating
DENVER-A new survey of more than 8,000 U.S. bank and credit union customers/members show satisfaction levels remain at their highest at credit unions and small banks, although large banks are showing significant improvement and all institutions are slipping in some areas, according to the 2011 Bank and Credit Union Satisfaction Survey released by Prime Performance.
CU members rate their overall satisfaction a net score of 89%. The comparable score for small banks (banks with less than 300 branches) is 88% and for large banks (300 to 4,000 branches) it is 80%. The industry average is 82%. Falling below that were: Bank of America, 73%; Wells Fargo, 75%, and Chase, 79%.
A net satisfaction score is the percent of satisfied customers minus the percent of dissatisfied ones. A score of 100 percent is perfect.
Borrowing Grows During October, But...
WASHINGTON - Americans borrowed more during October to buy cars and attend college, while also charging more on their credit cards, the second straight month consumers have done so, according to the Federal Reserve. The Fed released figures yesterday showing that total consumer borrowing rose by $7.6 billion, and the back-to-back monthly gains are a sharp increase to August, when borrowing was down. The biggest increase in borrowing during October was in automobile and student loans, which were up by 5.3%. Credit card purchases increased 0.6%, the Fed said.
...Moderate Loan Demand is Projected
PLANO, Texas-Credit unions can expect moderate loan demand to continue into 2012, according to Brian Turner, director of advisory services for Catalyst Strategic Solutions. Turner is basing his forecast on continuing issues with job growth. While the nation's unemployment rate fell from 9.0% to 8.6% in November, Turner attributed that improvement to a 315,000-worker decline in the total civilian labor force.
"The good news is that the unemployment rate is down. The bad news is that there are less people in the labor force. Therefore, the bottom-line is that nothing has really changed," said Turner.
Branches BTo Reflect Local Area
LEBANON, Ore.--Linn-Co Federal Credit Union has undertaken a renovation of its three branches to reflect the local market's relationship with the timber industry, local rivers, and its status as the "grass-seed king of the world." To that end, teller counters are being manufactured out of locally sourced, recycled timber, while the floor of the branches will have a winding path of river rocks embedded in the ceramic tile. To tie into the grass-seed industry, artwork will use actual grasses going to seed in acrylic panels that will be used as dividers between tellers. The credit union is also taking a number of steps to improve energy efficiency.
Video Highlights Office of Small CUs
ALEXANDRIA, Va.-NCUA's Office of Small Credit Union Initiatives (OSCUI) has released a free training video, "An Introduction to OSCUI." This half-hour video provides an overview of OSCUI's role within NCUA, and highlights four programs for small credit unions: Direct Assistance (one-on-one consulting); Training (classroom and online); Financial Assistance (grants and loans), and Partnerships with government, non-profit and private organizations.
The video includes program descriptions, testimonials, and practical tips to access OSCUI's services. Small credit union officials and NCUA staff talk about their experiences with OSCUI.
