Watermark Members Give Nod To Sound CU Merger
SEATTLE-Members of Watermark Credit Union last week approved a merger with Sound CU in Tacoma, which will form the fifth-largest credit union in Washington state with almost $1.2 billion in assets. The combined entity will operate under the Sound CU name starting Sept. 1 and will be based in Tacoma, with 21 branches from Lynnwood to Olympia.
CU Veteran & GAC Notable Jim Molloy Passes Away
ROCHESTER, N.Y.-Jim Molloy, longtime chairman at Congressional FCU who, as Doorkeeper of the U.S. House of Representatives, gave the annual invocation at CUNA's GAC, has died here from complications of diabetes. Mr. Molloy was 75.
James Molloy rose from south Buffalo's Democratic ward politics to become doorkeeper for six presidents. Molloy was the last of 30 people to hold the position of Doorkeeper from its establishment in 1789 to its elimination in 1994. Within this capacity, he introduced Presidents and heads of state to Congress, and coordinated 71 joint sessions and many other events within the House chamber.
Molloy, who served 30 years as chairman of the board of Congressional FCU, will best be remembered among credit unions for kicking off the GAC, which he did for more than a dozen years.
Digital FCU Members Line
Up For Discounted Gas
NASHUA, N.H.-Hundreds of motorists lined up outside the Briad St. Gulf Station last week to take advantage of $1.99 a gallon gas, courtesy of Digital FCU. The credit union, based in nearby Marlborough, Mass., was celebrating the year 2005 when it opened its first Nashua branch-and when gas was just $1.99. The $2 billion credit union hoped to serve 1,000 cars. DCU employees were on hand to pump gas and wipe windshields of participating vehicles. The credit union paid the station the difference between the promotional cost and the pump price of $3.83 per gallon. Also, DCU donated $1.99 per car to purchase school supplies for needy children in the Nashua Goes Back to School program.
CU Joins Auto Finance Exchange
RADCLIFF, Ky.-Fort Knox FCU last week said it had signed with BlueYield to join the company's consumer auto finance exchange. BlueYield is a direct-to-consumer auto finance lending exchange among consumers, lenders and lead sources. "BlueYield's relationship with national affinity partners such as AAA gives us an opportunity for high quality auto loan portfolio growth that we otherwise would not have," said Jennifer Heil, president of the $1 billion credit union.
Sallie Mae Reports $6M Loss
NEWARK, Del.-Student loan giant Sallie Mae has reported a second quarter loss of $6 million, compared to a $338 million net for the same period last year, due to mark-to-market losses on its derivatives portfolio. The second quarter loss was due to a pre-tax $414 million unrealized, mark-to-market loss on certain derivative contracts recognized in GAAP but not in core earnings results, compared to a $211 million unrealized, mark-to-market gain in the year-ago quarter. As a result, net income for the first six months was down by 71%, to $169 million from $578 million for the first half last year. Core earnings were $108 million in second-quarter 2011, compared to $95 million in the year-ago quarter.
Subprime Settlement Costs $85M
WASHINGTON-Wells Fargo & Co. will pay an $85-million civil penalty for misleading borrowers into taking out costly subprime loans and approving loans they were not eligible to receive, the Federal Reserve Board said.
It is the largest penalty the central bank has ever issued against a bank holding company related to consumer-protection violations, according to American Banker, an affiliate of Credit Union Journal.
The agency's allegations against the San Francisco-based holding company include the claim that sales personnel at its subsidiary, Wells Fargo Financial, were "steering" borrowers who could have been eligible for prime interest rate loans into more expensive loans with higher subprime rates. Employees also falsified borrowers' incomes so that they would qualify for loans that they otherwise would not have received, the Fed claims.
Personnel were allegedly encouraged to undertake such practices as a result of programs that included incentive pay and sales quotas. There were also inadequate controls in place to mitigate risk resulting from such of programs, according to the Board's notice. In agreeing to the civil penalty, Wells Fargo admitted no wrongdoing, the Fed said.