It's a fact. Credit unions are not just for personal accounts anymore. Today, savvy institutions are aggressively targeting the small business and micro-business market with a full range of products and the personal attention this underserved group has been lacking.

FORT LAUDERDALE, Fla. – New NASCUS Chairman George Reynolds took office at the NASCUS Annual Meeting Friday, signaling the beginning of his two-year term. Reynolds, senior deputy commissioner of the Georgia Department of Banking and Finance, was elected to the NASCUS Board of Directors in 2006. He follows Linda Jekel, director of the Washington Division of CUs, who served as chairman for the past two years. Also at the 2007 Annual Meeting, three positions were filled on the NASCUS Board of Directors: Tom Candon and Linda Jekel were re-elected to three-year terms, and Suzanne Cowan was elected to her first three-year term. In addition, Reynolds appointed Harold Feeney to a one-year term on the NASCUS Board. Feeney, a state regulator from Texas, received the NASCUS 2007 Pierre Jay Award.

EUGENE, Ore. – Oregon Community CU said Friday it has selected Better Branches’ indirect lending solution to expand its relationship with new members obtained through the CU Direct Lending program. The solution will help the $750 million credit union cross-sell CUDL members into multiple account relationships, to last after their car loans have been paid off. Better Branches is based in San Francisco.

SAN BERNARDINO, Calif. – San Bernardino Schools Employees FCU, with $55 million, was granted a TIP charter to serve more than 500,000 school employees in San Bernardino, Orange and Riverside counties, NCUA said Friday. One other credit union, Orange County Teachers FCU, also is authorized to serve education employees in those counties, as well as four others. NCUA granted another educational TIP charter to $110 million Chattanooga Area Schools FCU to serve all education employees in seven surrounding Tennessee counties and four adjourning counties in Georgia.

SACRAMENTO, Calif. – SAFE CU announced a new product Friday that will allow members to tie their auto loan to their home mortgage, enabling them to deduct interest on their auto loan from their taxes. Participants in the program, known as the Auto Equity Loan, must be home owners, but are not required to have their mortgage through the credit union. The $1.3 billion credit union is touting the new product as the first in the nation and a unique opportunity for members to recoup the interest paid on auto loans.

CHICAGO – The Federal Home Loan Bank of Chicago, which is negotiating a merger with the FHLB Dallas, reported Friday net income for its second quarter declined by 50% to $27 million, from $54 million for the same quarter last year. The major cause of the decline in earnings was a $97 million loss in the value of its trading securities. The Chicago Bank, which also is trimming its troubled secondary mortgage market program, known as Mortgage Partnership Finance, also booked a $4 million charge to reduce its workforce in the second quarter. The FHLB reported a $1.4 billion loss of the $37 billion mortgage portfolio it holds under the program. The Chicago Bank is facing the elimination of two of its top three customers, LaSalle Bank and MidAmerica Bank, which both are being acquired by larger banks. For the first two quarters the Chicago Bank reported a halving in earnings to $50 million, from $110 million for the first half last year. The Bank announced Thursday it is negotiating with the Dallas Bank to combine the two FHLBs.

SEATTLE – The Federal Home Loan Bank of Seattle, which was ordered by regulators to exit its secondary mortgage market program, continued to report improved financials Friday, announcing second quarter earnings of $14.6 million, up from $2.4 million for the second quarter last year. Since the end of 2004, the FHLB has sold off half of its holdings in the secondary mortgage market program and now holds less than $6 billion worth. Eighty-five percent of its mortgages were originated by WaMu, its biggest member. The involvement in the secondary market caused the Seattle Bank to run up as much as $400 million in paper losses on its hedging portfolio and forced federal regulators to enact a strict supervisory plan, since lifted, to strengthen its finances. Since then, the Bank has focused on its core mission to provide low-cost funding to banks, credit unions and other mortgage lenders. For the first two quarters the Seattle Bank reported earnings of $25.2 million, more than double the $10.5 million reported for the first half last year. The increases in net income for the three- and six-month periods primarily were due to an increase in net interest income resulting from reinvesting proceeds from maturing low-yielding investments, including, among others, the consolidated obligations of other FHLBanks, into higher-yielding short-term investments such as federal funds.

DECATUR, Ga. – Harland Clarke Holdings Corp., the nation’s largest check printer forged by the recent takeover of John H. Harland Co. by financier Ronald Perelman, said Friday costs related to the $1.7 billion deal created a $37.5 million loss for the second quarter, compared to a $3.9 million profit for the same period last year. The second quarter loss includes a one-time loss of $54.6 million related to the buyback of Harland debt after the deal. The combination of Harland’s check printing and back-office services with Clarke American, the check printer acquired in 2005 by Perelman, doubled the company’s second quarter revenues to $340 million. For the first two quarters of the year the company reported a loss of $32.4 million. Under the deal, M&F Worldwide, a holding company controlled by Perelman, acquired Harland and combined it with Clarke American, now called Harland Clarke Holdings Corp., which passed Deluxe Corp. as the largest check printer in the U.S. Harland Clarke Holdings will have three operating divisions: Harland Clarke check printing, Harland Financial Solutions and Scantron.

MOUNT LAUREL, N.J. – Pennant Capital Management, an investment fund seeking to scotch the pending takeover of PHH Corp., pressed its case Friday for a spin-off of the company’s mortgage operations, which includes the largest mortgage bank for credit unions. But Pennant, which has built a 9.4% stake in the mortgage and fleet management concern, has an uphill fight to convince other shareholders as PHH’s shares remain mired almost 20% below the $31.50 a share offered by GE Capital. PHH shares closed Friday at $25.95, up slightly from Thursday’s close of $25.59. Rather than sell the whole company to GE Capital for $1.8 billion, then have GE Capital sell the country’s 10th largest mortgage bank to private equity fund The Blackstone Group, Pennant wants management to sell the mortgage business separately. In a letter to management Friday, Alan Fournier, managing director of Pennant, said such a strategy could fetch as much as $35 a share for all of PHH. PHH, which has originated mortgages for hundreds of credit unions for years, became credit unions’ largest mortgage bank when it bought the mortgage operations of CUNA Mutual Group in 2005. That included more than 100,000 residential mortgages and a loan servicing portfolio of more than $12 billion, as well as relationships with more than 2,000 credit unions.

HOUSTON – Cardtronics Inc., which has emerged as one of the most important providers of electronic funds services for credit unions, said Friday it fell into the red for its second quarter to the tune of $5.6 million, compared to a profit of $769,000 for the second quarter last year. The company, in the process of acquiring 5,500 ATMs in 7-Eleven convenience stores connected to the CO-OP Financial Services network, attributed the second quarter loss to increases in selling, general, and administrative expenses, vault cash costs, as well as higher depreciation costs as it expanded its world-largest fleet of 30,000 ATMs to Mexico and the United Kingdom. Revenues rose 10% for the second quarter to $74 million. For the second quarter Cardtronics reported a decrease of 1% in average daily ATM transactions due to a decline in the average number of merchant-owned ATMs it operates in the U.S. For the first two quarters of the year, Cardtronics reported a 7% increase in revenues to $151.8 million, but a tripling of losses to $9 million, from $2.4 million of losses for the first half last year. Cardtronics is poised to connect 1,700 of its 7-Eleven ATMs, all Vcom self-service financial kiosks, to the Financial Service Centers Cooperative, the shared branching network for credit unions.

CREESTVIEW, Fla. – A member of Eglin FCU was charged with grand theft last week, nine months after he withdrew $3,250 that was mistakenly deposited into his account. Jeremiah Lynn, 24, withdrew the money on Oct. 31; six days after a posting error had deposited $6,862 into his credit union account, which had a previous balance of $333. A surveillance camera at the credit union branch shows Lynn withdrawing the funds.

TUCSON – A 21-year-old man believed to be one of the leaders of an international identity theft ring was sentenced Friday to seven years in jail for his role in an Internet scheme that drained more than $1 million from credit union and bank accounts. Jacob Green-Bressler was among 17 conspirators who obtained credit and debit card information via the Internet from all over the globe–including Vietnam, Pakistan, Jordan, Egypt, Russia, Canada, Mexico and Morocco–then used it to forge phony cards that were used to withdraw funds from customers at DM FCU, M&I Bank and Bank One (now JP Morgan Chase). In one instance, in March 2005, Green-Bressler and two accomplices used one of the cards to withdraw $148,000 at nearby Casino Del Sol. The conspirators, most of them under 25 years old, paid the overseas suppliers of the information a commission, generally less than 50%, of their earnings, prosecutors said. The ring produced and used more than 4,500 accounts during the scheme. The suspects lived in two houses in Tucson and made counterfeit cards by using blank cards and encoding the magnetic stripes with the stolen information. Before being sentenced, defense lawyers introduced a letter to the judge from Green-Bressler’s parents saying his computer skills were so great that he was offered a job at Microsoft at the age of 12.

DALLAS — Credit unions are taking a step forward with online lending technologies but two steps away from their members, according to one CU executive here.

WASHINGTON – President Bush yesterday rejected a expanded role for Fannie Mae and Freddie Mac in resolving the spreading mortgage crisis, saying the two secondary market giants need to stick to their knitting of buying and selling residential mortgages before they are given broader powers. The President was responding to a request by Fannie Mae CEO Daniel Mudd that Fannie be allowed to buy more mortgages, in order to add liquidity to the troubled mortgage market. But Bush reiterated his position that the mortgage holdings of the two secondary market giants need to be strictly limited. "First things first when it comes to those institutions," said the President. "Congress needs to get them reformed; get them streamlined. Get them focused, and then I will consider other options." Mudd joined Democratic Senate leaders this week in calling on regulators to lift the cap on mortgages held by Fannie, currently, $1.4 Trillion, in order to ease liquidity constraints in the mortgage market. The President’s remarks signaled the Administration is still at loggerheads with Congress on plans to reform the secondary market, which would set new oversight for Fannie and Freddie and the 12 Federal Home Loan Banks.

CHICAGO – Officials with the Federal Home Loan Banks of Chicago and Dallas are trying to resolve almost $38 billion in mortgage held by the Chicago Bank in order to proceed with the rare combination of the two FHLBs. The Chicago Bank, which originated the Mortgage Partnership Finance program copied by most of the other 11 FHLBs, was stuck with the mortgages purchased from credit unions and banks because they were unable to obtain authority to securitize them and move them off their books, according to sources familiar with the finances of the FHLB. As a result, the Chicago Bank was left holding millions of dollars in paper losses when interest rates turned up, the sources told The Credit Union Journal. Officials with the two FHLBs, who announced Thursday they are negotiating a merger, are working to resolve the issue, either by the sale of some or all of the massive mortgage portfolio, or a write down of the assets. The problem is different from those facing many troubled mortgage lenders trapped by subprime lending, as the mortgages held by the Chicago Bank are all prime. The Chicago Bank, though it is expected to report a second quarter loss over the next few days, is solvent and holds adequate capital to deal with the crisis. The secondary mortgage program has been the source of troubles at other FHLBs, as well, with the FHLB Seattle forced to sell off its mortgage portfolio and return to its core business of providing low-cost funding to bank and credit union members for their mortgage programs.

McLEAN, Va. – Long-term mortgage rates declined for the third week in a row, according to Freddie Mac. The average for the 30-year, fixed-rate mortgage dropped to 6.59%, from 6.68% last week; while the average for the 15-year, fixed-rate loan slipped to 6.25%, from 6.32%. ARM rates, however, rose, with the average for the five-year ARM moving to 6.33%, from 6.29% last week; and the average for the one-year ARM climbing to 5.65%, from 5.59%.

CALABASAS, Calif. – Even as shares in his company continue to slide, Countrywide Financial Corp. CEO Angelo Mozilo continues to milk his long-held options, earning him almost $100 million so far this year. Mozilo, the co-founder of the nation’s largest mortgage lender, exercised 92,000 options on Wednesday for $14.69 each, then sold the shares for $28.74, a one-day gain of $1.3 million, according to a filing with the Securities and Exchange Commission. The day before, Mozilo exercised 110,000 options for $9.94 each, then sold the shares for $28.06 each, a one-day profit of $2 million. Mozilo, who has taken home almost $350 million the last three years, has earned almost $95 million so far this year by exercising options.

ATLANTA – S1 Corp. said yesterday it earned a profit of $5 million, or eight cents a share, for the second quarter, up from a loss of $1.9 million, or three cents a share, for the same period last year, as sales were strong in both its Postilion and Enterprise operations. Revenues rose a strong 13% for the quarter, to $52.6 million. For the first two quarters, S1 reported an 11% rise in revenues, to $100.2 million, and a profit of $7.9 million, or 13 cents a share, compared to a loss of $2.6 million, or four cents a share, for the first half last year.

JACKSONVILLE, Fla. – Title insurer Fidelity National Financial said yesterday it bought back one million of its shares for $22 million from Chairman William Foley, the man responsible for the constant restructuring of the company over the three years, so Foley can make an investment in the wine industry. The company said it bought the shares at $22.09 yesterday, the closing price. Foley was one of the best paid executives in the country last year, earning more than $200 million from the spin off of the title insurer from Fidelity National Information Services, the provider of back office services for credit unions and banks. After the sale of shares to the company, Foley still owns 8.5 million shares of the title insurer valued at $190 million, and almost 6 million shares of Fidelity National Information, valued at $330 million.

IRVINE, Calif. – Autobytel Inc., the operator of carbuying web sites for hundreds of credit unions, reported yesterday its losses narrowed in the second quarter to $1.7 million, or four cents a share, from $7.9 million, or 19 cents a share, for its second quarter last year. The company, which operates more than 300 carbuying websites, continued to struggle though, reporting a 9% decline in second quarter revenues, to $30.1 million, and an operating loss of $5.8 million for the period. For the first two quarters, Autobytel reported a 21% decline in revenues, to $52 million, and operating losses of $16.8 million.