The CUJ Daily
Net Income Rises At U.S. Central
LANEXA, Kan.-U.S. Central CU said higher fee income helped raise its third quarter net 8% to $17.7 million, from $16.2 million for the same period last year. Fee income rose 13% in the third quarter to $13 million, with income from U.S. Central's payment services and from its Corporate Network eCom unit both increasing by $700,000, and for securities safekeeping by $300,000.
Still, the lower interest rate environment pushed down total interest and dividend income by 12% for the quarter to $166.4 million, causing the corporates' corporate to lower dividends and interest it pays out to members by 16% to $138.7 million for the quarter.
For the first three quarters, U.S. Central reported an 8% drop in interest and dividend income to $529.9 million, and a 9% decline in interest and dividend payments to $448.5 million. Through the first three quarters U.S. Central cut the dividends it paid on its Member Capital Accounts and Paid-in-Capital by 20% to $16.3 million, representing a 122 basis point drop from the prior year.
U.S. Central reported average assets of $37.9 billion for the third quarter, up 19% from the $31.8 billion averaged for last year's third quarter.
NCUA Shields UBIT Target
ALEXANDRIA, Va.-NCUA said it has approved a return to a federal charter for Stamford CU-just two years after the Connecticut credit union converted to a state charter.
The federal charter will shield the $52-million credit union, one of more than a dozen being audited by the Internal Revenue Services for unrelated business income taxes, from UBIT as federal credit unions are exempt from the tax.
NCUA also approved the conversion to federal charters for Railroad & Industrial CU, Tampa, Fla. ($135 million) and Insurance Services CU, Portland, Me. ($7 million). So far this year, 13 state credit unions have converted to federal charters, and 11 federals have converted to state charters.
Shared Branching Heads To Maine-
WESTBROOK, Me.-Maine's credit unions have signed an agreement with CU Service Corporation to bring shared branching to the state. Synergent, a subsidiary of the Maine league that provides a data processing solution, entered into the deal with CUSC for its Next Generation Network services.
The initial expansion of Maine locations will occur through an outlet concept where credit unions open all or some of their existing branches to the other participant credit unions' members. The new Maine network expects its first credit union service center outlets to be in place by January.
Lending Heats Up In September
MADISON, Wis.-Credit unions expanded their loan portfolios by a healthy 1% in September, bringing loan growth for the first three quarters to 7.2%, according to CUNA. The September loan growth shows, "that consumers are getting into the economy," said Bill Hampel, chief economist for CUNA.
Mortgage lending continue to lead the way, with fixed-rate loans real estate loans growing 1.9% and ARMs by 1.8% during the month. Used and new car loans grew a strong 0.9% and 0.7%, respectively. The accelerated loan growth indicates a higher economic growth rate for next year, suggested Hampel. Savings declined by 0.7% for September. As a result net capital grew from 10.5% to 10.7%; and the critical loan-to-share ratio rose from 69.4% to 70.5%, its highest since January.
FOM Free-For-All Breaks Out In Texas
DALLAS-State chartered credit unions have ratcheted-up the competition to serve the residents of Dallas County, with 10 credit unions now vying to serve all 2.2 million residents of the state's second-largest county.
State regulators with the CU Division said Monday they have approved application from two credit unions, Pegasus CU and Neighborhood CU, to serve all of Dallas County and have received application form three others, EDS CU, Dallas County Employees CU and Texans CU.
Five other state charters have already been granted permission to serve the county. Texans CU has also requested approval to serve another three million residents in six other Texas counties: Ellis, Johnson, Tarrant, Parker, Denton and Grayson.