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Dollar Plugs Reg-Flex,

Warns Of Federal Tax Fight

BOSTON-In one of his final addresses as NCUA chairman, Dennis Dollar touted to more than 1,500 credit union executives the new regulatory approach being introduced to the federal CU regulator.

Dollar, speaking at NAFCU's Annual Convention last week, said his introduction of regulatory flexibility, or reg flex, which eases restrictions on the healthiest credit unions, has helped credit unions better respond to the rapidly changing economic marketplace without sacrificing safety and soundness.

"The results speak for themselves," said Dollar. "Credit unions have never been safer, sounder and more consumer friendly than they are today."

Dollar, who was awaiting the presidential nomination of a successor, said througout his three years as NCUA chief he has striven to introduce this risk-based concept throughout the agency's rules and supervisory process. "We have gone back and have looked at every regulation on the books to see if we can make them more flexible without sacrificing safety and soundness," he said.

The NCUA chairman said he will continue his efforts to extend the risk-based concept to federally mandated requirements on minimum capital for CUs.

Dollar has been working with Congress to extend the risk-based system to the minimum capital, or prompt correction action, requirements imposed on credit unions under HR 1151.

Dollar also warned against a move in some states to tax credit unions, saying such efforts could work their way up to the national level. He also criticized the increasing consideration among some credit unions toward demutualization, with some CUs converting first to mutual savings banks and then to stock form.

He said despite what some might insist, the capital in a credit union belongs to its member-owners.

Prior to Dollar, NAFCU CEO Fred Becker spoke of the progress made on the federal charter over the last five years, bringing it back into favor among some wavering CUs.

Acquisitions Help Boost Fiserv

BROOKFIELD, Wis.-Diversified credit union outsourcer Fiserv Inc. said second quarter earnings surged 30% to $78.4 million, or 40 cents a share, from $66.6 million, or 34 cents a share, for the same period last year, on the strength of the company's acquisition strategy.

Revenues for the second quarter, boosted by two corporate additions, rose 16% to $738.6 million. For the first six months, Fiserv, fresh off its purchase of EDS' CU business, reported a 15% rise in revenues to $1.45 billion, and a 16% increase in net earnings to $152.6 million.

Second quarter results include two corporate acquisitions, ReliaQuote, Inc, an online life insurance marketer, and Wausau Benefits, an employee benefits administrator.

ATM Network Adds CU Members

BETHESDA, Md.-Allpoint, a new surcharge-free ATM network, said it signed 12 new financial institution customers, including five additional credit unions.

The new credit unions are: SEFCU, Albany, N.Y., Telhio CU, Columbus, Ohio, Meadows CU, Arlington Heights, Ill., Interchange FCU, LaVergne, Tenn., and AFL-CIO Employees FCU, Washington, D.C. The new network also said it raised $1.2 million in new capital from local investors.

Still, fourth quarter revenues braved a 34% slide in license and hardware sales to rise 3% to $109.2 million. For the year Jack Henry reported a 2% rise in revenues to $404.6 million, but a 16% decline in net earnings to $49.4 million, or 55 cents a share.

Operating expenses for the year increased 9%, with a majority due to a 27% rise in research and development costs.