WATERLOO, Iowa – Veridian CU announced yesterday it will be offering members a new payday loan which will be attached to a savings account. The credit union’s Payday Loan Alternative, or PAL, will be capped at 21% APR and will require borrowers to set aside half of the loan in a savings account. When an individual requests a PAL the amount will automatically be doubled and half of the loan will be deposited in a savings account and held until the loan is paid in full. To qualify for a PAL an individual must show proof of income, such as a pay stub or account statement and paycheck must be directly deposited into the savings account. The $1.1 billion credit union, formerly John Deere Community CU, will reduce the APR to 19% if individuals agree to automatically transfer loan payments from their savings account. Introduction of the payday loan program, due to start March 1, comes as state legislators are considering capping rates on car title loans, one form of payday lending.

BROOKFIELD, Wis. – Fiserv, the biggest outsourcer for credit unions, said yesterday that net income for its fourth quarter declined by almost 30%, to $105.9 million, or 61 cents a share, due mainly to several one-time occurrences. That included $35 million in collected termination fees; the closing of a lending company and a sharp increase in flood insurance claims and processing because of Hurricane Katrina and other hurricanes which hit the Gulf Coast in 2005. As a result, the company reported a 13% decline in fiscal year earnings, to $449.9 million, or %2.53 a share, from the year before. Still, Fiserv continued to grow its revenues, by 11% in the fourth quarter, to $1.2 billion, and by 12% for the full year to $4.5 billion.

SAN DIMAS, Calif. – Financial Services Center Cooperative said it has already added 46 shared branching locations to its national network and is poised to add 2,200 new locations in the next few months with the implementation of its deal with 7-Eleven stores. The shared branching network, one of two surviving after the recent combination of CU Service Centers with CO-OP Financial’s shared network, expects to add as many as 2,400 access points this year. The vast majority of those will be at 7-11 convenience stores where FSCC will connect to the chain’s Vcom financial kiosks.

WASHINGTON – CUNA spent much of its remaining financial resources from the last congressional elections helping newly elected lawmakers retire their campaign debt in the final six weeks of the year. CUNA’s political action committee contributed almost $100,000 post-election to congressional newcomers, including $50,000 in the final four weeks of the year, according to a report filed yesterday with the Federal Election Commission. Included were contributions to Democrat Nick Lampson, who returned to Congress by winning Tom DeLay’s Texas House seat ($5,000); and Democrat Ciro Rodriguez, who also returned to Congress by winning a House seat in Texas ($5,000); as well as new senators Bob Corker, R-Tenn.($5,000); Claire McCaskil, D-Mo. ($2,500) and Amy Klobucher, D-Minn. ($2,500); as well as new House members Charlie Wilson, D-Ohio ($2,500); Paul Hodes, D-N.H. ($1,000); Kristen Gillibrand, D-N.Y. ($1,000); Chris Murphy, D-Ct. ($1,000); Tim Walz, D-Minn. ($1,000) and Joe Donnelly, D-Ind. ($1,000). CUNA contributed almost $3.4 million to candidates and the parties in the last elections, and raised almost $3.4 million, both new highs.

WASHINGTON – New York Congresswoman Carolyn Maloney said she will renew efforts to tighten regulations over the growing practice of overdraft protection. Maloney, named chair yesterday of the House Financial Service subcommittee on Financial Institutions, said she will introduce a bill that will require that consumers opt-in to potentially costly overdraft protection plans, rather than be forced into them; that consumers are alerted when they are about to overdraw their accounts at ATMs; and that credit unions and banks provide comprehensive disclosures on their overdraft policies. Maloney cited a new report by the credit union-affiliated Center for Responsible Lending showing that banks are raking in increasing fees from overdraft policies, often without the knowledge or consent of consumers.

WASHINGTON – The U.S. Department of Justice announced yesterday it has closed without action its antitrust inquiry into the new credit score introduced by the three major credit bureaus. Equifax, Experian and TransUnion. The antitrust regulator began an informal probe after the three introduced the new system, called VantageScore, nine months ago, which will compete with Fair Isaac’s FICO score to help credit unions and banks determine the suitability of borrowers. Fair Isaac has filed a civil antitrust suit claiming the three credit bureaus are engaging in unfair and anti-competitive practices that harm the FICO score brand. The three bureaus, which dominate the U.S. market for credit reporting, currently sell and distribute FICO scores directly to lenders, which the lenders use to determine ability to repay all kinds of consumer loans. They also own the consumer data on which the scores are based. Fair Isaac said this will allow the three bureaus to unfairly manipulate the credit score price, sales and distribution in order to promote their new VantageScore at the expense of Fair Isaac or other credit score products.

BROOKLYN, N.Y. – The ongoing turmoil at Polish & Slavic FCU, one of the largest immigrant-based credit unions in the country, resulted in the ouster of the $1 billion credit union’s embattled CEO, credit union officials said yesterday. The board, which has fended off recent recall attempts and been involved in constant internal intrigue since NCUA’s takeover seven years ago, fired president and CEO Alicja Malecka on Tuesday night. The reason for the ouster was unclear last night but Alex Storozynski, vice chairman of the board, attributed the ouster vote to the ongoing infighting. It's politics, Strorzynski, who voted against the ouster, told The Credit Union Journal yesterday. My own personal opinion is Miss Malecka did a good job as (CEO). The credit union, which serves this city’s vibrant Polish emigree community, has been beset by political intrigue since NCUA put it into conservatorship in 1999, then installed its own board of directors.

WASHINGTON – The FDIC dealt a near-fatal blow yesterday to the bid by Wal-Mart Stores for a bank charter when it voted to extend a moratorium for new industrial loan companies owned by commercial entities for another 12 months. The move left the two-year-old application for deposit insurance for the ratil giant’s ILC in limbo, as Congress begins its own deliberations on the ownership of banks by commercial entities like Wal-Mart, Home Depot and CMS Energy, all of which are trying to enter the market through ILCs, so-called back-door banks. In voting to extend the current six-month moratorium for another year the five members of the FDIC Board agreed to let wait until Congress leads the way on the historic mix of banking and commerce. Earlier this week, leading members of the House Financial Services Committee introduced legislation to permanently bar commercial entities like Wal-Mart from banking through ILCs. The stakes are huge for credit unions and banks, which not only fear competition from the retailer famous for undercutting competition, but also worry that Wal-Mart could replace the 1,300 branches they lease in Wal-Mart stores with its own branches. Even without the bank charter Wal-Mart has penetrated deep into the banking market with a variety of consumer loan products, credit cards and its own growing network of ATMs. The company also recently obtained a banking charter just south of the border, in Mexico.

FRAMINGHAM, Mass. – Credit unions affected by the massive security breach at TJX have notified the national retailer they will seek compensation for hundreds of thousands of dollars, or more, of costs associated with recalling and reissuing credit cards to protect their members against fraudulent activity. The Massachusetts CU League sent a letter to the company, which is located just a few miles away, notifying TJX of its claims for repayment of costs. Dan Egan, president of the Massachusetts league, said yesterday that numerous credit unions have begun reporting fraudulent charges on their accounts, which they expect to grow significantly because of the scope of the data breach at the owner of TJ Maxx, Marshall’s, Home Goods and A.J. Wrights. “We’re just trying to position ourselves. Our costs are pretty steep for the replacement of cards,” Egan told The Credit Union Journal. The Massachusetts league and other credit unions representatives are also talking with their insurer, CUNA Mutual Group, about possible litigation to recover the costs. A representative for CUNA Mutual, which is still litigating over a similar data breach at BJ Wholesalers three years ago, said yesterday no decisions have been made yet on a legal action. Egan said dozens of credit unions in the three states he represents, Massachusetts, New Hampshire and Rhode Island, have replaced ‘well over 100,000 cards’ because of the TJ Maxx breach. In a letter to TJX, jim Blake, the chairman of the Massachusetts league and president of HarborOne CU, said his credit union has incurred over $100,000 in costs alone in recalling and reissing its cards. Meantime, at least two class action suits have been filed by consumers affected by the TJ Maxx breach seeking compensation for costs related to resolving credit disputes and fraud on their accounts.

DALLAS – CU Bank Shares Inc., the credit union-owned parent of Town North Bank, announced yesterday it raised $60 million in new capital from a stock offering among its credit union stock holders.

EL PASO, Texas – The National CU Foundation and Fannie Mae announced matching $25,000 grants yesterday to help fund a savings campaign targeted towards the burgeoning Hispanic population.

DES MOINES, Iowa – A 33-year-old man who was tracked with his partner to Yellowstone National Park after last May’s armed robbery at Community First CU, in Oscaloosa, was sentenced Monday to 16 years in prison. Aaron Rafferty, who was armed with a sawed-off shotgun during the hold-up, and his accomplice, Justin Shrader, were captured by park rangers more than a month later in Yellowstone after a hit-and-run car accident. Shrader’s trial is still pending.

ATLANTA – Electronic billing provider CheckFree Corp. reported yesterday that net income for its fiscal second quarter rose by 4% to $35.3 million, or 39 cents a share, fueled by a strong 11% growth in second quarter revenues. Revenues for the quarter were $237.2 million, compared to $213.8 million for the same quarter last year. For the first six months of its fiscal year CheckFree reported 9% growth in revenues, to $465.8 million, and an 11% increase in net income to $66.5 million, or 75 cents a share, compared to the first half last year.

SEATTLE – The Federal Home Loan Bank of Seattle, which had been under a strict supervisory agreement with federal regulators, said it will be paying its credit union and bank members a fourth-quarter dividend, albeit a small one. The Seattle Bank, which had its supervisory agreement lifted earlier this month, announced a fourth quarter payout of $2.2 million, or 10 cents a share, the same as the third quarter dividend–which was its first in two years. The Seattle Bank ran into troubles with its secondary mortgage market program, which it was forced to shed as part of its supervisory agreement with the Federal Housing Finance Board, the regulator for the 12 FHLBs. The Bank has been working over the past three years to work its way out of a $300 million paper loss on financial derivatives it bought to hedge the mortgage portfolio.

CALABASAS, Calif. – Countrywide Financial, the world’s largest mortgage bank, reported a 3% decline in net income for its fourth quarter, due to a decline in loan activity and credit quality. The company reported a 6% fall in revenues, to $2.76 billion, and a 2.7% fall in net income to $621.6 million, or $1.01 a share, compared to the fourth quarter the prior year. For the full year, Countrywide reported a 14% rise in revenues to $11.4 billion, and a 6% increase in net income to $2.7 billion, or $4.30 a share. However, fiscal year results include a 15% decline in mortgage banking revenues, to $2.1 billion, compared to the year before. Major gains were in banking (28%), capital markets (23%) and insurance (73%). Chairman and Chief Executive Angelo Mozilo said in a statement that the lender faced flat and inverted yield curve conditions, home price depreciation, slowing home sales, declining production volumes, and pressure on credit quality during the year.

RICHARDSON, Texas – Texans CU said yesterday it has signed with John H. Harland’s Scantron subsidiary to provide it with member and employee survey services. Scantron helps create question sets, manage collection processes, analyze and report results, and provide guidelines on how to implement the findings. For more than 17 years, Scantron has helped financial institutions and Fortune 500 companies with needs ranging from customer and employee surveys, organizational change initiatives, product and brand research, statistical analysis, to results implementation. Texans has $1.7 billion in assets and more than 155,000 members.

NORTH CANTON, Ohio – ATM maker Diebold Inc. reported yesterday it expects to take another charge this quarter of as much as $22 million related to its ongoing restructuring for the closure of a manufacturing plant in Cassis, France. The company said it fought through restructuring and impairment charges in the fourth quarter to more than double earnings to $27.1 million, or 41 cents a share. Still, restructuring charges of about $28 million last year and an impairment charge of $22.5 million related to the implementation of an enterprise resource planning system pushed down fiscal year earnings by 11% to $86.6 million, or $1.29 a share. Revenues for the fourth quarter grew by almost 2% to $825.4 million, and by a strong 12% to $2.2 billion for the full year.

WASHINGTON – Lawmakers and the credit union lobby are focusing on just four major provisions as they draft this year’s version of the CU Regulatory Improvements Act, better known as CURIA. The top priority, according to lobbyists involved in the process, remains enactment of a risk-based capital system for credit unions; followed by easing or eliminating the maximum allowable member business loans; setting a minimum member participation in votes to convert to mutual savings bank; and allowing community chartered and single common bond credit unions to participate in NCUA underserved expansions program. Several minor provisions will also be proposed, some dealing with governance issues. Representatives of CUNA and NAFCU are negotiating on terms of the four provisions in hopes of convincing members of the House Financial Services Committee to introduce the bill prior to CUNA’s annual government affairs conference next month. That will allow the 3,000 or so credit union operatives in town for the event to lobby their lawmakers on the bill.

SAN DIEGO – Two local credit unions, long-time partners in civic and political projects, San Metropolitan CU and Cabrillo CU, have agreed to share two retail branches in the city. The bilateral agreement, outside of the various shared branching networks, is believed to be one of the first in the nation to share branches. The deal will allow members of San Diego Metropolitan to use Cabrillo’s Scripps Ranch branch, and for Cabrillo to use San Diego Metropolitan’s Kearny Mesa branch, with the respective credit unions paying each other a nominal $1 a month rent.

DALLAS – CU Bank Shares Inc., the credit union-owned parent of Town North Bank, announced yesterday it raised $60 million in new capital from a stock offering among its credit union stock holders. The new funds will go towards expanding the two main lines of business for the only credit union-owned bank, credit card issuing agreements with credit unions and commercial real estate development, according to Scott Wagner, executive vice president for TNB Card Services, the bank’s card issuing arm. TNB is one of two credit union-owned entities vying to acquire and manage credit union card portfolios, the other is the Wescom CU, which only recently entered the market. But Wagner insisted the boost in capital is not a response to the entry of the California credit union giant into the market, asserting that TNB had and has enough resources to compete. TNB manages 109 credit union portfolios it purchased since entering the market in 2002. TNB was acquired by credit unions in 1975 to ensure credit union access to the Federal Reserve payment system and is now owned by 36 Texas state chartered credit unions.