Are any credit unions too big to fail? The answer is paradoxically both "Yes" and "No."

OCTOBER

While expectations of an imminent Fed rate hike have dissipated over the last month, widespread speculation remains that the FOMC will raise rates this year, with futures markets pricing in nearly a 50% chance of a 25 basis point (bp) hike by late October, and another 20% chance of a 50 bp hike.

Events

OAKLAND, Calif. - NCUA liquidated troubled Kaiperm FCU last week and sold the remnants of the one-time $145-million credit union to Alliant CU, the $6-billion Chicago credit union formerly known as United Airlines Employees CU.

MANCHESTER, N.H. - St. Mary's Bank said it is expanding its support of the City of Manchester's West Side Revitalization Plan, with a new loan program that offers a special pricing for West Side property owners. The program will offer loans at rates as low as 6.25% on five-year ARMs to renovate one- to four -unit residential properties.

WASHINGTON - Congress approved a stopgap funding bill for the federal government which includes new borrowing authority for the Central Liquidity Facility, the emergency loan fund operated by NCUA.

St. Mary's Bank, Manchester, N.H., named Seth Zeigler financial consultant.

EAST LANSING, Mich. - Michigan State University FCU celebrated the completion of its new 140,000 square-foot home offices last week. The $1.5-billion credit union hosted local and state dignitaries last week and plan to host a separate event for members and the public Oct. 19. Attendees of the event were treated to a performance by the Michigan State University professors of jazz, and also took tours of the new headquarters.

CHEVY CHASE, Md. - GEICO, FCU said it has implemented US Biometrics' AccessQ fingerprint biometrics system for controlling physical access to its facilities.

TALLAHASSEE, Fla. - Credit Union 24, the largest credit union-owned ATM and point-of-sale (POS) network in the U.S., said the number of surcharge-free ATMs available to members of member credit unions has now passed 50,000 for the first time.

LAFAYETTE, La. - University of Louisiana FCU this week celebrated its 50th anniversary this week with giveaways and promotions, including a 4.5% CD. The promotional CD brought in $1.8-million of new funds in one day. The $32-million CU started in a cubbyhole in one of the University's buildings and now has a staff of 32 and its own offices.(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com/ http://www.sourcemedia.com/

BOULDER, Colo. - It's the Holy Grail for many credit unions: converting members gained through indirect loans into full-fledged, engaged members.

PORTLAND, Ore. - Credit unions' growing presence in commercial lending and additional opportunities in such loans aren't projected to dry up anytime soon, according to the leaders of several CUSOs that specialize in member business loans (MBL).

GALVESTON, Tex. - As credit unions have found ways to keep operations going following Hurricane Ike by borrowing generators and working out of makeshift or damaged facilities, what's really kept member service intact are CU employees.

ROCKVILLE, Md. - A new twist in auto lending and competition among employees was exactly the shot in the arm that one credit union needed to boost its loan portfolio by more than $10 million.

WASHINGTON - The acquisition of Wachovia Corp. by Citigroup and Washington Mutual by JP Morgan Chase & Co. has created a new risk-related concern among some analysts: institutions so large the failure of any one of them could cripple the financial services market and drain the bank insurance fund. The Wachovia/ Citigroup merger creates an institution with $2.9-trillion in assets, approximately four times the size of the entire U.S. credit union community. The Washington Mutual/JPMorgan chase combination creates a $2.1-trillion institution. And Bank of America, when it completes digesting its deal for Merrill Lynch, will have $1.9-trillion in assets.

JACKSON, Miss. - With the fate of some CU facilities on Hurricane Ike-battered Galveston, Texas still unknown, one credit union hit hard by Hurricane Katrina three years ago offers some HOPE among the rubble.

SEATTLE - When its ailing balance sheet forced federal regulators to seize Washington Mutual, its new CEO, Alan Fishman, was in just his 17th day on the job. But don't look for Fishman to be seeking out a credit union that serves the underserved.

WASHINGTON - In order to facilitate the sale of Wachovia Corp.'s assets to Citigroup earlier this week the Federal Deposit Insurance Corp. used the "systemic-risk" exception for the first time in history. The exception allowed the FDIC to cover part of Citi's cost should the loss on Wachovia's assets exceed $42 billion, and enabled it to receive $12 billion in preferred stock and warrants from Citi. Under the transaction, all depositors were protected, according to a report by American Banker, an affiliate of Credit Union Journal. The agency also was able to complete the deal without formally failing Wachovia, instead conducting it as an open-bank transaction-an action the FDIC had not taken since 1992.