Fed Moves To Keep Share Growth Slow
WASHINGTON-The Federal Reserve last week proceeded with its bid to tamp down inflation and raised short-term interest rates for the 12th time in a row, by 25 basis points, to 4%. The Central Bank also indicated it will continue its inflation-busting bid and raise rates by another 25 BPs at its next two meetings by year-end.
"They're signaling that the economy is in decent shape but they're still worried about inflation," said Jeff Taylor, senior economist at NAFCU.
But Taylor suggested the Fed's actions have had little tangible affect so far, as housing continues to boom, fueling overall economic activity. Credit unions have reacted to the Fed's rate-rising by boosting CD rates but holding down rates on core share and share draft accounts near record lows, Taylor told The Credit Union Journal. The effect has been low share growth, which he predicted will continue for the rest of the year.
Prime Figure In RISDIC Failure Back In Jail
PROVIDENCE, R.I.-One of the key figures in the 1991 collapse of the state credit union system will remain in jail for violating the terms of his probation, which included paying restitution. Real estate developer David LaRoche was ordered to pay $4.5 million in restitution for his role in the collapse of the 1991 Rhode Island Share and Indemnity Corp., the private deposit insurer for the credit unions. The state Supreme Court ruled this week that LaRoche violated probation when he failed to pay the restitution, even though prosecutors said he was able to spend lavishly on vacations, investments and his son's college expenses. LaRoche, 60, has seven more years to serve on his sentence.
Man Convicted Of Robbery
VIRGINIA BEACH, Va.-A Newport News man was convicted last week of robbing the same credit union-ABNB FCU-within two months in 2002. In the first robbery, Clarence Terrell, Jr., 30, approached the teller, placed a gun on the counter and told her to fill a plastic grocery bag with cash. He did the same thing two months later and got away with about $5,200 in the two robberies. Neither the gun or the money was recovered when he was captured several months later. Terrell faces up to 25 years in prison when he is sentenced on Jan. 24.
Harland Reports Profits Up
ATLANTA-Credit union outsourcer John H. Harland Co. said last week that third quarter earnings surged 54% to $18.6 million, or 65 cents a share, compared to the same quarter last year. The rise in third quarter earnings was fueled by a 33% increase in revenues to $260.7 million, based mainly on the company's acquisition of Liberty Enterprises. Sales in Harland's core printed products unit rose 36% for the third quarter to $159.8 million because of the Liberty acquisition. The third quarter results included a $7.9 million charge for discontinuation of a project to develop a new customer care system in the printed products division.
Employees Help Thwart Crime
FORT WAYNE, Ind.-A would-be robbery was thwarted by employees at Pinnacle CU on the afternoon of Oct. 31 who locked the doors to the building when they saw two masked men dressed in black approaching the building. The quick thinking barred the would-be robbers from the building and forced them to flee the scene in their getaway car. The two were arrested a short while later when the car was spotted by police.
CU Central Falls Donates $50K
CENTRAL FALLS, R.I.-Credit Union Central Falls has agreed to donate $50,000 to the $2 million renovation of the 100-year-old Ralph J. Holden Community Center. Credit union officials were on hand earlier this week to present a $10,000 check as the first installment of the pledge to kick-off the fundraising drive. The facility houses a pool, locker rooms, basketball court, weight room, game room, senior meal site and Channel One-Central Falls, the city's social services department.
The Credit Union Journal's On Deadline coverage is sponsored by