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Bankruptcy Filings On The Rise

WEST PALM BEACH, Fla.-Bankruptcy filings are surging as consumers seek to beat new rules from the Bankruptcy Reform Act that go into effect in October.

Since President Bush signed the bill into law into April, bankruptcy filings have risen 12% nationally through July, and are up by as much as 22% in some areas.

The increase follows a leveling off in bankruptcy filings and even a slight decline during 2005.

Some analysts are attributing the increases in filings to greater advertising by bankruptcy attorneys alerting consumers to the law's change, which makes it harder to have debts wiped out and to start fresh. More consumers will now have to seek protection under Chapter 13, which requires more debt to be repaid. It is estimated approximately 1.8-million people will file for bankruptcy during 2005.

Share Growth Slows To A Trickle

ALEXANDRIA, Va.-Share growth at the nation's credit unions slowed to a glacier's pace in the second quarter of the year, while credit unions struggled to maintain their competitiveness, according to NCUA.

Second quarter share growth was just 0.5%, the slowest in a decade, as credit unions continued to keep their dividend rates low to maintain profitability.

As a result, profitability tipped upwards slightly to 0.93% return-on-average assets, compared to 0.92% for the first quarter, NCUA said.

Loan growth was strong in the second quarter, 3.3%, compared to just 1.1% in the first quarter. This pushed the key liquidity ratio, the loan-to-share ratio, up to a five-year high of 75.9%. Delinquencies remained near all-time lows, at 0.65%.

Lending continues to be paced by mortgage loans, but auto lending also strengthened in the second quarter.

Fed Likely To Keep Raising Rates

ARLINGTON, Va.-Expect to see the Federal Reserve Board hoist the Fed Funds interest rate at every single meeting through the end of this year, predicts NAFCU Economist Jeff Taylor.

Taylor suggested that although inflation isn't strongly influencing consumer behavior, as yet, the Fed will be seeking to curtail inflation through more rate hikes.

The continuing wild card in the economy, he said, is oil prices.

CO-OP Network Enters Missouri

MISSOULA, Mont.-The CO-OP Network has made its first inroads in the Big Sky State with the signing of Missoula FCU as its newest member. Members of the $212-million CU will now have access to more than 20,000 CO-OP Network ATMs nationally.

CO-OP Network will also process all of the credit union's EFT transactions.

OK CUs Roll Out Media Campaign

OKLAHOMA CITY, Okla.-Oklahoma's credit unions have rolled out a cooperative campaign of commercials based on existing area billboards and print media.

The "Financial Firsts" and "Happily Ever After" ads direct consumers to visit, where information is available about credit unions and the benefits of membership.

Iowa CUs Help Cancer Victims

DES MOINES, Iowa-Representatives from the Iowa Credit Union Foundation and the Iowa league are offering guidance to former Iowa Army Ammunition Plant (IAAP) employees who will soon receive money because they developed cancer.

The league and foundation were among several state and private agencies invited by Sen. Tom Harkin (D-IA) to offer information about consumer protection and finances. Also on hand were representatives of the Iowa securities bureau, the Iowa attorney general's office, Iowa State University Extension, and the Iowa Bar Association.

The Department of Energy and Atomic Energy Commission built nuclear weapons components at the 19,000-acre IAAP in Burlington, Iowa, during the Cold War.

Congress and the Department of Health and Human Services recently approved automatic $150,000 payments to workers. (c) 2005 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.

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