CUs Reprice Accounts More Quickly
ARLINGTON, Va.-Credit unions seem to be moving more quickly to reprice their products and services following changes in rates by the Federal Reserve, according to NAFCU Economist Jeff Taylor.
"I've only been working with credit unions for about four years, but back when the Fed was dropping rates, credit unions were slow to reprice, particularly their shares," he told The Credit Union Journal.
"Now they seem to be repricing a little faster than in the past." It's important that credit unions are nimble when rates move up or down, he said, noting, "you can get behind, and then when it comes time to change your rates, you have to move them by a bigger chunk, and that can upset members."
FOM Expanded To 1.3 Million People
GARDEN CITY, N.Y.-The $245-million Nassau County FCU is expanding to a community charter to serve anyone who lives, works, worships, volunteers or attends school in Nassau County, as well as immediate family and household members.
The credit union currently has 27,000 members; some 1.3 million people live in Nassau County.
IRS May Revoke Non-Profit Status
WASHINGTON-Recent rulings by the IRS may be an indication that the agency is considering changing the nonprofit, tax-exempt status of the consumer credit counseling industry, according to the Coalition for Responsible Credit Practices, which has been pushing for such a change.
"Based on its analysis of two IRS determination letters recently made public, the Coalition for Responsible Credit Practices believes the IRS is about to begin a wide-spread rejection of credit counseling agencies' 'nonprofit' or charitable, tax-exempt status," the coalition said. "Such sweeping rejection would dramatically change the credit counseling industry and impact hundreds of thousands of consumers, as well as lenders and other businesses."
In the letters, the IRS rejected the applications of two CCAs seeking nonprofit status, spelling out a number of criteria for its rejection-characteristics that the coalition says have been associated with many such independent agencies in recent months including: lack of adequate education efforts, close ties between the nonprofits and for-profit companies, executive compensation issues and other private-benefit issues.
Commercial Check Usage Eroding
SAN FRANCISCO-More than half of financial executives across 20 industries said they will be reducing their organizations' reliance on checks as a form of commercial payment.
The findings are part of VISA USA's second annual cash management survey, which additionally found that of the 51% who plan to use fewer checks, 40% of that group said they will do so by increasing usage of commercial payment cards.
The responses indicate that a significant and growing perception among financial executives is that commercial payment cards play a very important role in almost every aspect of the cash management process, VISA said.
"Some key activities companies hope will reduce costs and boost operating efficiency include the increased use of electronic payments through cards and the elimination of paper checks and invoices," it added.
Trial Set For CU On Defaulted Loan
BANGOR, Maine-A trial has been slated for March to determine whether Katahdin Federal Credit Union should be paid $3.2 million it loaned the previous owners of the former Great Northern Paper Inc., which declared bankruptcy after taking out three loans totaling $3.2 million from the CU.
Great Northern had used several properties as collateral on the loans, but the board later transferred those properties to Great Northern's parent company, Inexcon Maine.
First Failure Of A Regulated UK CU
LONDON-The first failure of a regulated CU in the U.K. has occurred. Hackey South CU has been taken over by regulators; now its members are waiting to see how they will be compensated by the insurer of those deposits, the Financial Services Compensation Scheme.
Most of the CU's 1,100 members had less than ?2,000 on deposit, according to its interim CEO, Ron Devlin. Under the FSCS, members of institutions in default are compensated for 100% of their deposits up to ?2,000; they are reimbursed 90% of remaining funds up to ?31,700.
Two Large Australian CUs In Merger
ARMIDALE, Australia-The merger of Peel Valley CU and New England CU will create the largest inland credit union Down Under, following a vote of NECU's membership in favor of the merger.
The union was approved with 97% of those NECU members who voted supporting the move. Earlier, PVCU's voting members supported the merger by 98%.
No employees will lose their jobs due to the merger, the CUs reported. The merged credit union will be headquartered in Armidale.
