TAKE ACTION! - Montana Credit Union Network

May 2009
Credit Union Directors
TAKE ACTION!
Volunteers make CUs Work
VITA Site Volunteers
MCUCD Receives Award
pg 3
pg 7
pg 14
editorial & reports
From My Perspective
cover story
Volunteers Make
Credit Unions Work
page 3
VITA Volunteers and
the 2009 Tax Season
page 4–5
Credit Unions’
Most Valuable
Lobbying Asset
page 7
CMG’s True
Commitment Program
page 9
MCUCD Receives
Wegner Award at
GAC Gala
page 14
~ In Each Issue ~
page
Being asked to run for a director position at a local
credit union is a bit like being recruited for a sports
team or a part in a play. Someone convinces you
that you’re perfect for the role, but you still have to
prove yourself to the membership and get elected.
And, did they mention that the hours one needs to
dedicate to learning about the industry and keeping
up on current issues really make it a second job?
When I first joined the board of Richland Federal
Credit Union in Sidney over 20 years ago, it was for
somewhat selfish reasons. You see, the position on
the credit union board offered me—a local car dealership owner—a way to better understand the lending business. Little did I know my decision would
open my eyes to an entire movement that I am
proud to associate with and be a part of today.
The people I’ve met and worked with over the years
in the credit union have given me invaluable insight. It is gratifying to know that the decisions we
make on behalf of Richland FCU are changing lives
in a positive manner. On a recent trip
to Washington D.C.,
our group explained
to our Congressional
delegation how credit
unions differ from
banks, and having
an elected volunteer
Senator Max Baucus shakes Gary
board plays a key role. Schoepp’s hand during a Hill Visit at
the 2009 GAC in February.
As directors, we are in
the community every day with the member-owners of
our financial institutions. We have to answer to them
for the decisions we make, and we see the direct effect
of those decisions on our community.
That gives me great incentive to help our valued
members and our credit union succeed.
Gary Schoepp has served on the Board of Directors of
Richland FCU in Sidney, Montana, for more than 20 years.
Hot Fla hes
Cover Story. . . . . . . . . . . . . . . . . . 3
Philosophy in Action. . . . . . . . . . 4
For Your Dues. . . . . . . . . . . . . . . 6, 7
League Service Group. . . . . . . . 8, 9
TSCCU Update . . . . . . . . . . . 10, 11
CUsource Update. . . . . . . . . . 12, 13
Recognition. . . . . . . . . . . . . . . . . 15
Network News
Publication Staff
Beth Satre
Editor and Design/Layout
Photographer
Editorial Board
Tracie Kenyon, Tabitha Garvin,
Tracy Houck, Steve Howke,
Donya Parrish, Bob Pyfer,
Jeanne Saarinen, Karen Smith,
Ranel Smith, Tracy Thornburg
2—network news
Leslie: I love this theme: “Credit Union Directors
Take Action,” it’s appropriate on so many levels.
Tracie: One of the primary tenets of the credit union
movement is our volunteer governance!
Tracie Kenyon
Leslie Hunter
Leslie: With the assistance of “everyday” members
guiding our credit unions, we stay true to our focus
of “people helping people.”
Leslie: Well put. Directors assist in shaping the strategic vision of their credit union. They know their
members well because they’re members themselves.
Tracie: That’s right …volunteers bring a unique perspective that paid directors don’t have…they’re at the
board table simply to ensure that their credit union
remains responsive to its member/owners.
Tracie: I appreciate the simplicity of the credit
union movement…a group of people pooling their
resources to benefit themselves through a democratic
organization.
Leslie: And by adding the phrase “taking action,” we
really get to the heart of the matter…credit union
directors make things happen!
Leslie: Every member has one vote, regardless of their
balance; that’s how credit union directors are elected.
Tracie: Absolutely! The Credit Union Board of Directors Handbook states it like this, “As a director,
you help determine how your credit union translates
this abstract ideal into real-world financial services.”
Tracie: The idea of cooperative credit is powerful!
Leslie: And it’s timely even after 100 years!
Tracie: Well, you know what they say, “everything
old is new again.”
Cover Story
Volunteers Make Credit Unions Work
They’ve been called the backbone of the credit union
movement, the unsung heroes of a business that uses
democracy and service as its guiding principle: volunteers. In Montana, over 400 people donate their
time and expertise to credit unions, and nationwide
the number is over 111,000.
How much is that worth? Statistics from the Independent Sector indicate that each volunteer hour is worth
$17.55 (based on the average hourly wage of non-management workers from the Bureau of Labor statistics).
However, the monetary value is even greater in that
credit union volunteers receive no remuneration for
their service, as compared to the directors of banks.
Since credit unions are non-profit financial cooperatives, this additional savings eventually returns
to the credit unions’ members.
Getting Involved
How and why someone gets involved in their
credit union board is as different as the volunteers
themselves. Personal satisfaction and belief in the
credit union philosophy are primary reasons directors serve. Others see volunteer service as part
of their civic responsibility or a way to gain new
knowledge or skills.
Changes Over the Years
Having volunteered for so many years, these credit
union members have seen a great deal of change.
Some were around when share drafts were first authorized, and others were integral in getting cutting
edge electronic services out to members. As credit
unions have grown and the financial world has become more complex, board members have played
a major role, helping their credit union decide how
to expand services while making sure their credit
union remains well-capitalized and viable.
Benefits of Volunteering
Being able to see that the credit union and its
members benefit from their input is reward
enough for these unpaid board and committee
members. Helping members become financially
savvy is important to many.
Looking to the Future
One of the major concerns of these long-tenured
volunteers is getting younger volunteers to help.
Reaching out to new, younger members to volunteer becomes daunting since many of those younger
members have very stretched lives. Board members must attend regularly scheduled meetings, find
time to interact with their membership, meet with
lawmakers to discuss credit union issues, and learn
more about their credit union operations.
Long-time board members know a lot about a credit
union’s history and purpose. Some credit unions
understand that this information can be helpful to
Volunteers make cus work, cont. on page 14
important
info
Board Duties & Responsibilities*
A credit union’s board of directors is responsible for
directing and controlling the affairs of the credit
union. While board members do not usually perform
the specific tasks involved, they are ultimately responsible for making sure the credit union …
• is capably managed by a knowledgeable CEO
and experienced staff;
• operates using sound business practices;
• complies with all applicable laws and
regulations;
• achieves the goals stated in the charter and the
strategic plan;
• provides adequate financial reserves to cover
delinquent loans and other losses; and
• protects against unauthorized or illegal acts
through safe-operating procedures and the
purchase of fidelity bond coverage.
To carry out its role in meeting these requirements,
a board developes policies, approves programs, hires
and evaluates the CEO, and appoints committees.
Further, board responsibilities can be grouped into
four major areas.
• Policies and Planning
• Communication
• Trusteeship
• Ensuring the Continuity and Development of
the Credit Union
*This information is taken from CUNA’s Credit Union Board
of Directors Handbook, Third Edition. See page 7 for more
information on this helpful publication.
network news—3
Philosophy in action
VITA and Credit Unions: A Lot in Common
Credit unions are run by volunteers, and so are Volunteer Income Tax Assistance (VITA) sites. Credit
unions provide an
affordable alternative to high-cost and
sometimes predatory service providers,
and so does VITA.
While every VITA
volunteer deserves
special recognition,
MCUCD would
like to highlight
three Montanans
High Peaks FCU also participated in the Credit Union VITA program, bring- that serve as a volunteer both at their
ing a tax preparation site to Dillon for the first time this year. Pictured
local VITA site and
above are High Peaks FCU President/CEO Tammy Hatfield, volunteers
a local credit union.
Theresa Bennett and Dale Carson, and greeter Dee Carlson
2009 Credit
union VITA
Statistics
Montana CUs
Participating in VITA
1st Liberty FCU
Participating CUs
14
Bear Paw CU
Number of CU
VITA Sites
18
Elkhorn FCU
Total Taxpayers
Served
2,079
Total Refunds
$ 1,759,790
Average Income
of VITA Clients
$16,949
Tax Preparation
Fees Saved
$322,201
EDTECH FCU
EnerGComm FCU
Fort Peck Community FCU
Heritage FCU
High Peaks FCU
Mile High FCU
Mountain West FCU
Park Side FCU
Richland FCU
Russell Country FCU
4—network news
Wolf Point FCU
Linda Satterly is “greeter extraordinaire” at the very
busy VITA site held at the Aldersgate United Methodist Church in Butte, which is sponsored by five local credit unions. When the waiting list is long and
over 50 people are waiting for their time with the
volunteer tax preparer, Linda makes sure everything
runs efficiently—for both the taxpayers and the volunteers. Linda also serves on the supervisory committee of EDTECH Federal Credit Union.
Bonny Gay serves as the one and only volunteer tax
preparer for the community of Glasgow. She also
serves on the board of directors of Fort Peck Community FCU. Bonny has just completed her second
tax season as a VITA volunteer. “This experience
has been an eye-opener for me. There are so many
people in the community who really need the help.”
Bonny also said she was happy to see returning clients this year that used the service last year. “They
really appreciated the service.”
“This experience has been an eyeopener for me. There are so many
people in the community who really
need the help.”
— Bonny Gay
Glasgow VITA Volunteer
This tax season was Maxine Monahan’s first year
volunteering at Heritage FCU’s VITA site in Butte.
But she certainly isn’t new to tax preparation; Maxine is a newly retired tax professional. When asked
how she got involved in VITA, she said with a laugh,
“Kathy [Shea] hoodwinked me into it.” Maxine volunteers as a supervisory committee member for Heritage FCU, and said overall VITA has been a great
experience. “I enjoyed serving those who truly need
the assistance—the elderly and low income.”
If you are looking to give of your time to a project
that fits the credit union ideals, look no more. There
are many volunteer opportunities with MCUCD
programs—such as teaching basic financial skills,
helping at a tax site, and sharing consumer education materials in your community. To learn more,
go to www.montanacreditunions.coop and click on
“Get Involved!”
philosophy in action
Making a Difference in Havre by Marie Hobson
This year—2009— marks Bear Paw Credit Union’s
second participating in the VITA (Volunteer Income
Tax Assistance) Program. I have been the site coordinator for both years. As site coordinator, I schedule all appointments, coordinate all media outlets in
the Havre area for PSAs, contact the volunteers, and
maintain the work area. I also send out appointment
letters and call each client to confirm appointments.
My back up site coordinator is Carly Huffman.
“Helping clients who could not
otherwise afford to have their tax
return prepared has been a very
rewarding experience.”
— Marie Hobson
Havre VITA Site Coordinator
Helping clients who could not otherwise afford to
have their tax return prepared has been a very rewarding experience.
The 2007 tax year (or 2008) was the first year that
many clients receiving social security were required
to file a tax return in order to receive their federal rebate check. Without our VITA service, these clients
would have spent a considerable amount of money
to hire someone to prepare their tax return. As a result of the VITA service, taxpayers learned that they
were eligible for a state refund through the Montana
Elderly Homeowners/Renters Credit. Most clients,
upon learning about this credit, decided to file previous year’s returns and were able to take advantage of
this state credit.
MCUCD’s support of the Program
Without Montana Credit Unions for Community
Development, Bear Paw Credit Union would not have
been so successful at conducting the VITA program.
During BPCU’s first year, MCUCD wrote a grant to
cover program expenses and handled all the grantrelated paperwork. This gave us $4,198 in funds to use
for computer and printer rental, technical assistance,
outreach, supplies, volunteer training expenses, and
mileage reimbursement. MCUCD also provided all
training materials, computer equipment, and supplies.
MCUCD staff was readily available for any questions.
Since our site generally had only one volunteer each
day, the staff at MCUCD also served as the quality
reviewer for the tax returns, an essential part of the
tax preparation process.
a few PHOTO s
from “after
tax season”
parties
VITA Volunteers
In BPCU’s first year, we had
just one volunteer: Gil Oen.
With the help of Jeanne
Saarinen, Executive Director at
MCUCD, we still prepared 71
tax returns and brought over
$62,000 in tax refunds into the
Havre community.
Gil provided his services every
Tuesday and Thursday afternoon. In addition, if clients
were unable to schedule an
appointment for one of these
days, Gil was willing to adjust
his schedule to accommodate
them. Gil has had experience
with North Dakota’s VITA
program in previous years.
This year, Bear Paw Credit
Union and MCUCD advertised for volunteers earlier than
in prior years. This was well
worth the effort as our VITA
site had four volunteers—
Gil Oen, Debbie Woodwick,
Angie Hanson, and Glenda
Hanson—for this year’s season.
2009 was our best year yet. We
prepared a total of 110 returns,
making it possible for over
$107,490 to be put back into
the pockets of people in
our community.
ABOVE: John Douglas, a first year VITA volunteer, and
his wife Linda, who sits on the EDTECH FCU Board of Directors, smile for the camera. Center: Havre volunteers
I would like to thank everyone
Deb Woodwick, Gil Oen, and Angie Hanson celebrate the
who supported the VITA proend of tax season. Bottom: Mary Maloney a long-time
gram this year. Your time and
effort is much appreciated and I VITA volunteer poses with MCUCD’s Robert Coble and
look forward to working with you Abby Wolf.
in 2010.
Marie Hobson is a accountant at Bear Paw Credit Union
where she has worked for nearly four years.
network news—5
for your dues
Your Network Staff
Tracie Kenyon
President/CEO
[email protected]
Robert Coble
Program Support Coord., MCUCD
[email protected]
Clyde Dailey
Dir.–Government Relations
[email protected]
Tabitha Garvin
COO, Business Development
[email protected]
Kelly Johnson
Office Coordinator
[email protected]
Renee Lyman
Education Assistant
[email protected]
Marcy Martin
Dir.–Administrative Services
[email protected]
Donya Parrish
VP–Dues Supported Services
[email protected]
Bob Pyfer
General Counsel
[email protected]
Jeanne Saarinen
Executive Director, MCUCD
[email protected]
Beth Satre
Dir.–Communications/PR
[email protected]
Volunteer Training
In February, 27 credit union directors from across
Montana traveled to Billings to attend a one-day
training session that the Montana Credit Union
Network had designed especially for them.
“Being a board member takes a lot of commitment
and learning,” said Donya Parrish,
MCUN’s VP of Dues-Supported
Services.
“I was especially impressed with
the ‘seasoned’ veterans who came.
They were anxious to learn more
and willing to pass along what
they already knew to the rest of the
group, Parrish noted.”
Participants attended sessions that addressed the following issues, which are
important to fulfilling board duties:
• What Every Director Needs to Know
• Planning for Growth,
• Common Audit Findings,
• Balance Sheet Management, and
• Supervisory Committee Responsibilities
other Training opportunities for volunteers
In early February, a group of Montana credit union
board members attended the Western States Volunteer Conference in Las Vegas. This annual conference offers great education and gives directors the
A few photos from the
February’s Volunteer Training: ABOVE: Paula Ruddock
(Rimrock CU), Jim Balzar
and Kathy Bostic (Russell Country FCU), and Dick Lohof
and Bill Pedersen (Avanta FCU) Center: Bob Fox, Greg Erpenbach,
and Dick Nauman (Avanta FCU) Bottom: Fred Dickensheets (Rocky
Mountain CU) and Bruce Blotkamp (Gateway FCU)
chance to meet other volunteers from the region.
MCUN is also offering a two-day Directors Conference in August. (For more information, see page 16.)
Karen Smith
Dir.–Outreach Services, MCUCD
[email protected]
Ranel Smith
Education Services Director
[email protected]
Ask Compliance
Q: We just had a board member resign. Do we ap-
point their replacement to serve until the next annual meeting of members or until the original term
expires?
A: It depends! Your credit
union needs to look to your
bylaws for guidance on this
issue.
6—network news
Federal credit union bylaws
generally state that “directors
and credit committee members appointed to fill a
vacancy will hold office only until the next annual
meeting, at which any unexpired terms will be filled
by vote of the members.” [Found in Article VI, section 4 of the 2006 version.]
State chartered credit unions do not have a model
bylaw, so this makes it especially important to research this issue in your own credit union’s bylaw
verbiage. Some have a statement that the position
is filled unti the original term expires and others
have a statement similar to FCUs, that it is only
until the next annual meeting.
For more information on Board Governance issues,
visit the Q&A archive online at www.mcun.coop/
QA_Archive_36.html?article_id=88. The archive also
has a wealth of information on many other issues.
for your dues
Credit Unions’ Most Valuable Lobbying Asset
volunteers give us our tax exemption
Whenever Bob Pyfer, Montana’s chief credit union
While serving as a beacon for paid lobbyists to tout
lobbyist for nearly 20 years, spoke to a group of
credit union uniqueness is enormously valuable, even
credit union volunteers, his opening was always the
better is the volunteer communicating directly with
same, “Thank you. Thank you for being who you
lawmakers and executive officials. Should a legislator
are and doing what you do. You make my job easy.
ever mistakenly say to a credit union director/citizen
Whenever I’m talking to state or
federal legislators, I never miss
In a very real way our volunteers give us our tax
the chance to tell them about the
exemption.…credit union volunteers are a shining
wonderful men and women who
give back to their communities by light, giving unselfishly of themselves to improve
giving back to their not-for-profit,
the financial well-being of the entire membership.
cooperative credit union.”
Our uncompensated directors and committee
members make credit unions unique among financial institutions. Along with our member-owned,
democratic, non-stock capital and control structure,
it is volunteerism that makes us worthy of our tax
exempt status. In a very real way, our volunteers give
us our tax exemption. Especially in these times when
new examples of corporate greed and financial malfeasance are being revealed on an almost daily basis,
credit union volunteers are a shining light, giving
unselfishly of themselves to improve the financial
well-being of the entire membership.
League Board
Leslie Hunter
Chair
Kathy Shea
Vice Chair
Chris Sisco
Secretary
Jeremy Presta
Controller
Wally Berry
Director
Bob Bjelland
Director
Tom Boos
Director
Bernie Neibauer
Director
lobbyist, “You’re paid to say that,” the proper retort
would come, “No Senator, I’m not. I’m not paid at
all. I say it because I believe it.”
There is no greater credibility than that which
comes from lack of self-interest. This is why our
volunteers are strongly encouraged to get involved
with trips to Helena or Washington or to visit with
legislators in their hometowns, to tell them about
the gratification of serving credit union members,
381,693 strong in Montana. And to all of you, we say
“Thank You!”
Greg Strizich
Director
LSG Board
Kathy Shea
Chair
Gerry Veis
Vice Chair
Ed Stofko
Secretary/Controller
CUNA Handbook
Kathy Briggs
Director
Great resource for Board members
CUNA has recently revised their seminal resource
for credit union board members. The Credit Union
Board of Directors Handbook is now available in it’s
third edition.
This is the one book that helps directors build confidence and gain shared understanding. It provides
wide-ranging information on the wide range of topics that are key to understanding and helping a credit union’s daily performance achieve “star quality.”
Topics the Hanbook covers
• Director’s profile
• Duties and responsibilities
• Director’s role in relation to other committees
and staff
• The key relationship
between the board
and CEO
• Legal liabilities and
protections
• Conflicts of interest
• Insurance protection
• Insights to effective communication
Nancy Harris
Director
Leslie Hunter
Director
Teri Krakowka
Director
This edition covers recent legislative challenges and
the importance of political involvement. It’s loaded
with individual and group assessment tools to help
expand knowledge and group unity.
To order, visit CUNA’s Products & Services website
online at http://buy.cuna.org/detail.php?sku=22824
network news—7
The Next Generation
LSG Business
Partners
Catering to the Hannah Montana
fans of today means building a stronger credit union for tomorrow
CO-OP Financial
Services
Kendra Chidester, 12, has a routine. Every morning,
the seventh-grader from Desoto, Texas, wakes up to
No Doubt’s “Just a Girl” on her pre-programmed cell
phone, logs on to her Facebook account, and then
sends a few texts to friends.
Teach Them
In Capital One’s 2008 “Back to School” survey, 52%
of teens were eager to learn more about money management, but only 14% had taken a class on the topic.
About 35% would like to learn from their parents.
Needless to say, the times have changed. Generation
T (age 12 and younger) is being defined by its embrace
of technology. By 2023, the children you see walking to school and playing at McDonald’s will control
$3.48 trillion in income, according to a recent CUNA
National Member Survey. Credit unions can’t afford
to lose this market.
When asked about the topics they’d most like to learn,
teens expressed interest in how financing works for
large purchases (such as a car or a home), investing
money, identity theft and how to protect themselves,
saving money, budgeting, stocks, checking accounts,
and credit cards.
Counterfeit Cop
CUAdvantage
CU Auditing
CU Recovery
CU Succeed
CUNA Mutual Group
CUNA Strategic
Services
Empire Office
Machines
Fidelity Information
Services (formerly
Certegy)
HRValue Group
ICUL Service
Corporation
John M. Floyd &
Associates
Mountain West
Benefits
PolicyWorks
Wolters Kluwer
Financial Services
Adding or
Reviewing
Services?
for quality
business
solutions
for your
credit union
call
Tabitha Garvin
800.745.5546 ext 132
[email protected]
8—network news
Below are a few ideas on how to prepare to serve this
growing online generation in years to come.
Offering online tools such as calculators, games and
blogs on your credit union website will help this
generation feel connected and educated.
Go Mobile
A Charles Schwab survey found that tweens (9-12)
and teens are more likely to have a cell phone (74%)
than a savings account (60%). To meet the needs of
this paperless, texting, iPoding, and social networking
generation, think beyond online—think mobile.
Speak Their Language
“Segmentation—the notion that different people need
to be spoken to in different ways—is crucial for credit
unions,” says Ed Speed, CEO of Texas Dow Employees Credit Union (TDECU), in a Filene report about
social media.
Research firm Tower Group estimates that
more than 40 million U.S. consumers will
adopt mobile banking by 2012. Cell
phone carriers are already processing
direct payments for items such as ring
tones. According to a Filene Research
Institute report, a survey of active
users of online banking say they
are very interested in checking
their account balance, contacting customer service, locating
an ATM/branch, transferring
money and reviewing statements
from their wireless phone.
TDECU was the first American credit union to
launch a follow-up to the popular Young & Free
Alberta campaign developed by Currency Marketing. Young & Free Texas (www.youngfreetexas.com)
includes an online video competition for the most
dynamic spokesperson, who is then hired for a year,
given cameras, a computer, and a TDECU car to
spread the news about everything free in Texas—including the credit union’s GO2 account, which offers
free checking and access to CO-OP ATMs.
“Mobile banking is happening
all around us,” says
Bill Butler, CEO
of Ohio HealthCare FCU. “By
getting in the
game, we will
become stronger
credit unions.”
Focusing attention on something besides the credit
union was essential, says Trey Reeme, who leads the
Young & Free initiative at TDECU. “Especially in a
turbulent economy, people are looking for ways to not
spend as much,” he says in the Filene report.
TDECU will measure success by how many new
accounts are opened by 18- to 25-year-olds and by
increases in the credit union’s wallet share among
the group, according to Speed.
©2009. Reprinted with permission from Think magazine,
published for CO-OP Financial Services by Market and
Sales Logic.
Give Members a sense of financial security and Increase Income
Overdraft Programs
A survey conducted last year by the National Association of Federal Credit Unions asked participants
about the importance of non-interest income to their
credit union’s bottom line. Responses indicated that
more than two-thirds of respondents believed noninterest income was “very important” and 28.4% saw
it as “somewhat important.” When asked about their
largest source of non-interest income, 81.7% said that
the majority of their credit union’s fee income came
from overdraft fees.
As this survey shows, an overdraft privilege program
can provide a substantial boost to a credit union’s
profitability. In fact, it is one of the quickest ways
to improve the bottom line. And, if implemented
and maintained correctly, it can result in increased
member satisfaction.
In an uncertain economy, consumers are more concerned than ever about doing business with an institution that helps them maintain financial stability.
They want to know that if they make a mistake on
their account or experience an unexpected financial
emergency, their transactions will be covered.
For many, it is worth moving their business to an
institution that can save them the embarrassment
of having a check
returned, help them
avoid paying an adJMFA, a preferred provider for the MCUN,
ditional penalty or
is a profitability and performance improvehaving to find another
ment consulting firm that serves more than
source for payment
2,000 financial institutions in all 50 states
(such as a payday
and in Central America. As a direct result of
lender), borrowing
its programs, JMFA has helped thousands
from family, or addof clients dramatically improve their perforing to their credit card
mance and their bottom line. To learn more
debt. Let’s face it, conabout JMFA, please contact Jared Cahill,
sumers expect their
National Director of Alliances at
financial institution
877-510-5603 or [email protected].
to cover their items. If
a credit union doesn’t
have an overdraft privilege program, it could be at a
disadvantage.
LSG services
If your credit union doesn’t currently have an overdraft program in place, consider contacting our preferred partner, John M. Floyd & Associate’s (JMFA)
to get started right away. JMFA’s consumer-focus,
attention to regulatory compliance and best management practices will help you understand the kind
of bottom line improvement likely if a credit union
implements an overdraft program.
Human Resource
Management Service
Strategic Planning
Network Compliance
Service
NADA
Help recognize an employee who’s gone above and beyond
CUNA Mutual Seeks Stories of True Commitment
Every day, credit union employees do things that
prove their true commitment to serving members’ best interests. Sometimes, they go far beyond expectations—and a great story is born.
Help CUNA Mutual collect these stories, and
shine the spotlight on your deserving employees.
CUNA Mutual is creating a rallying point to emphasize the special role of credit unions in these
difficult times. The company has been gathering
stories of exceptional commitment from its own
employees, and is seeking to carry the concept
forward with stories from credit unions.
Watch for the “Sign of Commitment”
CUNA Mutual’s goal is to eventually feature these
stories on its website and other communications.
True Commitment, cont. on page 14
How to submit your stories
If you have a story to tell about an employee or team
from your credit union going above and beyond to
benefit a member or your credit union, please visit
www.cunamutual.com/TRUECU.
Adding or
Reviewing
Services?
for quality
business
solutions
for your
credit union
call
Tabitha Garvin
800.745.5546 ext 132
[email protected]
network news—9
CEO Corner
Steve Howke, President/CEO
Your TSCCU Staff
Steve Howke
President/CEO
(128
[email protected]
Sylvia Jackson
Director of Compliance
and Risk Management
(129
[email protected]
Tracy Thornburg
Director of Administration
and Operations
(139
[email protected]
Kara Connors
Business Development Analyst
(137
[email protected]
Frances Calhoun
Operations Assistant/MSR
(125
[email protected]
Diane Halferty
Member Services Representative
(130
[email protected]
www.tsccu.org
Imagine going to a bookstore and
seeing a book by your favorite author
prominently displayed under the new
arrivals sign. You eagerly rush over to
the table, grab a copy, and head for
the checkout stand. Later that evening,
after the kids have fallen asleep and
you’ve pulled on your ultra-comfortable, drool-resistant, reading pajamas,
you finally get the chance to crack
open your new book.…
To your dismay you discover that all but five of the
book’s pages are blank, and those with writing are
in the middle. Did you pick up a defective copy?
Do you need to find a new favorite author because
this one has become one of those irritating performance artists that demand effort, imagination, and
audience participation before revealing the meaning of the piece?
Reading Credit Union Financials
Like a great book, your credit union’s financials
have a story to tell. But, looking at them in isolation
can be a lot like reading a book with a lot of blank
pages. Whether you’re reviewing raw numbers or
ratios, you need previous financials and an inquisitive mind to understand their story.
Peer Group Information
You should also compare any changes you notice to
internal changes in your credit union and in other
credit unions in your peer group. NCUA provides
peer group information based on similar asset levels.
CUNA and Callahan’s Peer to Peer are other sources
of peer group information that let you use a number of other parameters to narrow your comparison.
These comparisons can be helpful; you learn how
your credit union stacks up against others and you
can use that as a gauge to measure possible improvement. The point of this exercise is not to identify
A word from the Chair
It was great to hear that this
quarter’s Network News ediHow many prior period financials do you
tion is devoted to Directors and
need? There is no set answer, but usually
Volunteers. As we are all aware
the more you have the better.
volunteers are the backbone of
What questions should you ask? You
the credit union movement. As
should concentrate on three things when
professionals we personally apanalyzing current financials or ratios:
preciate the time and effort our
change, comparisons, and context.
own credit union volunteers give
for us. We, too, have the opporAs an example, let’s look at quarterly statetunity to give back to the credit
ments that go back one year from the
unions who have membership in
month being reviewed (for example: 4/09,
Kevin Mayer
Treasure State Corporate Credit
1/09, 10/08, 7/08, 4/08). Having a year’s
TSCCU Board Chair
Union and the Montana Credit
and Richland FCU CEO/President
worth of data lets you view the current
Union League by volunteermonth with the concepts of change and
ing
our
services.
We
are elected to the board by our
comparisons in mind. For simplicity’s sake, considpeers who all have a common interest—ownership.
er four categories—balances in loans, investments,
shares, and assets.
10—network news
(1/09) or in the past year (4/08). This gives you an idea
of longer- and shorter-term changes. Next, look at
what happened to those same categories for the two
quarters (7/08, 10/08) following last year’s financial
statements (4/08). Do any trends appear that can help
gauge what may happen going forward? Be careful
here. Historical trends viewed in isolation might not
be as reliable as they seem, but they shouldn’t be ignored. Viewed in the right context, those trends can
be helpful in forcasting possible developments.
As you review the statements, consider how the balance sheet has changed in the past three months
As directors of Treasure State, it is our responsibility,
as with any of your directors, to set policies that govern Treasure State and approve monthly dividends
areas that your credit union excels in—but to ask
why. The main theme when looking at financial data
is to search for explanations that can offer insight
into your operations.
Putting your observations in context
Now it’s time for the really important part—pulling
all the pieces together and putting your observations
in context. What is going on with your membership, community, county, state, and the economy as
a whole? What happened to your earnings on assets
as a result of the Federal Reserve’s recent decision to
dramatically ease interest rates? How about cost of
funds? Did this compare to what happened during
the 2001-2003 easing? What about when rates increased from 2003–2005?
These are very distinct interest rate cycles, and it is instructive to see how your assets and liabilities repriced
during these times. You may also want to look at balances in loans, investments, and shares. Other factors
that might be affecting your credit union are national
recessions, weather patterns (for those in agricultur-
al regions), local industry performance, etc. This is
where it gets fun—looking at the story that your
financials tell and how they react to various factors.
You should also decide what is an important measure
of your credit union’s mission to your members and
identify a way to quantify and measure how you are
fulfilling those goals. For instance, if your goal is to
be your members’ primary source of credit, simply
using the loan-to-share ratio as a gauge would not
suffice. You would also need to look at the number of
borrowers to members, types of loans, average balance,
etc. Get creative with what you want to measure and
make sure that you have enough “pages” of information available to tell you the whole story.
Oh, and one last thing … I should’ve told you to
get into your ultra-comfortable, drool-proof pajamas at the beginning of this article. That way, if you
fell asleep in the middle of it, you would at least be
comfy.
Your TSCCU
Board of Directors
Kevin Mayer
Chair • Richland FCU
Steve Grooms
Vice Chair • 1st Liberty FCU
Kathy Briggs
Secy/Treasurer • Family First FCU
Gary Clark
Director • Missoula FCU
Annamarie DeYoung
Director • Sky FCU
Rhonda Diefenderfer
Director • Avanta FCU
Paula Ruddock
Director • Rimrock CU
Asset/Liability
Committee
Brent Martin
Chair • Helena Community CU
Annamarie DeYoung
Sky FCU
Gary Clark
Missoula FCU
to the membership. The main difference between
corporates and natural person credit unions is the
regulations that apply to corporates. Treasure State
is regulated by the NCUA rules and regulations 704.
These regulations are specific to corporates, and we
are responsibile for have a thorough understanding
of these regulations.
TSCCU directors are very committed and dedicate a
tremendous amount of time for your corporate. We
have monthly board meetings as mandated and, given
the large geographical area that Treasure State serves,
we try to meet in person at least three times a year and
conduct our other meetings via conference calls.
We do this for the benefit of the membership and
for the gratification of giving back to the members/
owners. This is no different than natural person
credit unions as we, too, need to keep the best interests of the membership in mind as we set policies.
Our membership is quite diverse; Montana’s credit
unions range in asset size from less than $600,000
to more than $1 billion in assets.
As everyone is aware, 2009 welcomed us with turbulent times in the Corporate Network. The market
displacements caused two of the Corporates to fall
under conservatorship, putting our membership
capital at risk. I want to assure the membership that
your elected directors are in constant communication with staff and are diligently working for you to
protect your investment in Treasure State. In these
circumstances, the word “volunteer” could almost
be translated to “a challenge.” This is a challenge we
did not expect or want, but are willing to accept.
In closing, I have had the honor to serve on many
boards within my own community. My involvement
with Treasure State has provided me with a complete understanding of the credit union movement.
There is nothing I take more pride and responsibility in than my role as a volunteer for your corporate.
Al Vukasin
Bear Paw CU
Steve Howke and
Sylvia Jackson
TSCCU
Supervisory
Committee
Teri Krakowka
Chair • Southwest Montana
Community FCU
Deb Evans
Great Falls Teachers FCU
Dave Stenberg
Park Side FCU
Laura Scoville
Gateway Community FCU
network news—11
CUsource
Management Team
Shirley Bailey
President / CEO
[email protected]
Mary Lehman
Chief Financial Officer
[email protected]
Mark Mauler
Programer/Engineer
[email protected]
Kevin Hollingworth
Technical Services Manager
[email protected]
Brandi Holefelder
Software Services Manager
[email protected]
Kelly Calnan
Draft Services Manager
[email protected]
Mickey Kunnary
Print/Mail Services Manager
[email protected]
Tom Dedman
Product Development
[email protected]
Tracy Houck
Marketing & Business Development
[email protected]
Due Diligence and the Director
Partnering with
third party vendors
can increase efficiency and lead to member growth; however,
credit unions need
to be prudent when
selecting vendors and
engage in a process
of “due diligence.”
This relatively new
buzz phrase, governing how credit unions choose third party vendors,
often strikes fear in the hearts of those sitting at the
board level.
What is ‘Due Diligence’?
When credit unions are looking to partner with a
third party vendor, staff members are usually responsible for the fact-finding investigations to determine
whether vendors are financially and organizationally
healthy enough to take on the new business. Staff
insight fleshes out the risks and how the credit union
can manage those risks. Since the credit union board
of directors is responsible for planning, directing,
and controlling the credit union’s affairs, the ultimate decision to enter into contracts often lies at the
board level.
Data processing is usually the single most important
third party relationship a credit union may have.
Second to data processing are lending programs,
such as sub-prime lending programs and real estate
processing. Essentially, the more you delegate, the
more risk you are assuming.
CUsource, LLC
Corporate Office
501 Park Drive S, Ste 400
PO Box 3329
Great Falls, MT 59403
Great Falls: 800.823.2876
Helena: 800.430.0215
Billings: 800.528.6668
www.cusource.com
12—network news
Financial Fitness
Are your third party vendors financially fit? More
and more financial services companies are struggling and making painful layoffs to shore up
their financials. Too often in these scenarios,
performance suffers. Choosing the right service
providers or analyzing a current relationship is
important.
“Reading the financial information and company
audit may be the easiest part of reviewing a due
diligence package for a board member especially
when research is rife with technology and systems
operations.” Shirley Bailey, CUsource President/
CEO explains. But it doesn’t tell the whole story.
NCUA suggests breaking down the process into
subcategories and looking into the following nine
areas: planning, background check, legal review,
financial review, return on investment, insurance requirements, policies and procedures, staff oversight,
and reporting.
Reputation
Keep in mind, every company has weaknesses and
strengths. The credit union’s goal should be to select the best fit. A director’s job, then, is to ascertain
whether the proposed vendor’s activities are consistent with the credit union’s overall business strategy and risk tolerances. What practices does a credit
union value, and what do vendors’ references say
about their businesses?
CUsource prides itself on sharing many credit union
philosophies—it’s easy to recognize that the company is owned by credit unions.
“We are happy to announce the second annual distribution of client patronage checks,” said Bailey, “it
is a great privilege to recognize our clients’ loyalty
and business.”
CUsource has been doing business locally for 20
years. It is financially fit and has never lost a data
processing client to another vendor. In 2008, CUsource expanded its business offerings to include print/
mail, draft services, and network services. As a result, CUsource counts almost all of Montana’s credit
unions as clients.
CUsource offers a host of services aimed to help
senior management and board members (see the
FMS Board Reporting Package on the next page)
and remains committed to protecting its client
relationships. The organization recognizes the importance of providing clients with the information
needed to satisfy outside and inside demands for
safety and soundness. While these due diligence
steps are tedious and feel overwhelming, taking the
extra care now will pay off big in the end. Third
party relationships are an important part of a credit
union’s success.
understanding credit union financial statements
FMS Board Reporting Package Can Help
When asked what aspect of
their credit union responsibilities concerns them the most,
many volunteer directors reply “learning
to read and understand my credit union’s financial
statements.”
Harland Financial Solutions has developed a software
package that might make it easier for credit union
board members and staff. Their Financial Management Software (FMS) Board Reporting package
provides quick access to an institution’s financials
by combining multiple reports, graphs, and charts
into an easy-to-follow document. This gives board
members a comprehensive, up-to-the-minute look at
financial highlights and other information they need
to make financial decisions.
Dashboard and Ease-of-Use Technology
The FMS Board Reporting Dashboard provides a
financial snapshot of an institution and the financial
market as a whole. Whether it’s month-end analysis,
board or management meetings, or any fiscal-based
decision, this dashboard is a launching pad
for reporting.
FMS Board Reporting Dashboard summarizes
and consolidates financials into concise statements, ratios, analysis, charts and graphs. With
an intuitive, menu-driven interface, this board reporting package is simple to use and automatically interfaces with your existing general ledger to
pull balances and status. Then, the FMS package
can create a multitude of descriptive graphs, ratios, and multi-column comparisons in a customtailored presentation.
Comprehensive and Scalable Board Reporting
The FMS Board Reporting package is customizable, allowing credit unions to extract the exact
financial data they need. Credit unions can use one
of the existing board report templates or craft their
own by using and combining the following financial reports:
•
•
Key Ratios
Management Summary
Real Estate Office
Dan Eggen
Sr. Processing Specialist
[email protected]
Chandra Thronson
Sr. Processing Specialist
[email protected]
•
•
•
•
•
•
Interest Analysis (Interest Rate Spread
and Net Interest Margin)
Rate/Volume Analysis
Balance Sheet
Income Statement
Rolling Statements
Comparative Statements
increased Efficiency and more current information
As a result, credit union staff no longer needs to
spend hours (or days) manipulating, exporting, or
reentering the raw numbers their general ledger spits
out. With FMS Board Reporting, it’s possible to generate complete financial reports in seconds with a single click of the mouse. The board reports can then be
exported into a .pdf file or a PowerPoint presentation
for easy distribution. Implementation of the FMS
Board Reporting package is a snap. Don’t wait. Call
CUsource for a quote and demo at 800-823-2876.
Audrey Arnold
Sr. Processing Specialist
[email protected]
Stacy Anderson
Processing Clerk
[email protected]
Your CUsource
Investors and
Board of Directors
Tom Boos
Chair • Billings FCU
Greg Strizich
Vice-Chair • Helena Community CU
Wally Berry
Secy/Treasurer • Montana FCU
Anna DeYoung
Director • Sky FCU
Rhonda Diefenderfer
Director • Avanta FCU
Deb Evans
Director • Great Falls Teachers FCU
CUsource: Behind the Scenes
When it comes to credit unions, CUsource definitely
works “behind the scenes.” Whether processing
drafts, printing statements,
securing a credit union’s network
or running its processing platform, CUsource is committed to
making credit unions look good.
In April, CUsource sent out its
second annual patronage checks
to data processing clients. Cooperative pricing and excellent
customer service are just
two reasons to do business with CUsource.
For more information
please contact Tracy at
1-800-823-2876.
Tom Kiely
Director • EDTECH FCU
Bernie Neibauer
Director • Russell Country FCU
Chris Sisco
Director • Montana First CU
CUsource, LLC
Corporate Office
501 Park Drive S, Ste 400
PO Box 3329
Great Falls, MT 59403
Great Falls: 800.823.2876
Helena: 800.430.0215
Billings: 800.528.6668
www.cusource.com
network news—13
COVER STORY
Volunteers Make CUs Work (cont. from page 1)
Board-CEO RElationship*
Boards and CEOs are partners. As credit unions
have grown and the financial world has become
more complex, the traditional roles of board and
CEO have also evolved.
This means that boards must delegate both responsibility and authority to their credit union’s
CEO. Once the board has set direction by adopting a policy or goal, it must allow the CEO the
freedom to implement the policies to reach the
goal. In other words…
• The board develops a strategy for the future;
the CEO implements it.
• The board approves budgets; the CEO
determines how to use them.
• The board approves financial and personnel
policies; the CEO implements them.
• The board delegates tasks by giving clear
instructions; the CEO carries them out.
• The board establishes performance standards
and controls; the CEO ensures their observation
by staff.
* The board provides for proper communications
among the people involved; the CEO uses these
channels to get the job done.
*This information is taken from CUNA’s Credit Union
Board of Directors Handbook, Third Edition. See
page 7 for more information on this helpful publication.
important
info
14—network news
the next generation and have created a “director emeritus” position, in
which a retiring board member may continue to come to meetings and
provide input—without a vote—and the credit union does not lose that
member’s knowledge.
Other board members get involved as an associate member of the board
first. In that role, they attend meetings, go through training, and essentially act like a board member, but do not have a vote. This prepares
them for the task when a future position is open, but also gives the credit
union an additional idea or voice for direction of the company.
Volunteers Help Set the Tone
Avanta FCU President/CEO Rhonda Diefenderfer understands how important an engaged, enthusiastic board can be for a credit union. “We’re
very fortunate to have a group of board members that are so engaged in
our credit union, our activities, and the credit union movement overall,” observed Diefenderfer last year when her entire board was given the
2008 Mitch Reed Volunteers of the Year award.
“They exemplify the credit union philosophy of ‘People Helping People.’”
It is obvious that volunteers are the cornerstone of many Montana credit
unions. No matter how things change, volunteers will continue to be an
important part of the credit union movement. It’s been said that serving
as a board member is an honor, but the position is anything but honorary. Board members give of their time, learn new roles that are often
outside of their expertise, attend regularly scheduled board and emergency board meetings, and assume fiduciary responsibilities.
It is because of the 400 Montanans who devote countless hours to their
board responsibilities as volunteer directors that credit unions are unique,
that they are thriving even in today’s competitive marketplace, and that
so many lives are made fuller through the credit union movement.
True Commitment (cont. from page 9)
The company started this project at CUNA’s Governmental Affairs Conference (GAC) in Washington. Hundreds of credit union leaders stopped by
the CUNA Mutual booth to add their signatures to
the “Sign of Commitment.” For each signature, the
company made a donation to the National Credit
Union Foundation’s Development Educators Program, totaling $2,500 for the event.
To build on that success, the
“Sign of Commitment” campaign will appear at League
events throughout 2009. Please
watch for it and demonstrate your commitment to
the credit union movement by signing on if you
haven’t yet.
Meanwhile, when your credit union shows once
again why the credit union difference matters so
much, please let CUNA Mutual help you capture
that inspiration and pass it along.
Recognition
And the envelope goes to…
Montana's Credit Unions
On February 23, 2009, Montana Credit Unions for Community
Development took home the "Credit Union Oscar" when it received
the prestigious Herb Wegner Memorial Award for Outstanding
Organization. The award was presented during the 21st Annual Wegner
Awards Gala hosted by the National Credit Union Foundation.
“It was a highlight of our year when Montana Credit Unions for
Community Development received the credit union movement’s
highest national honor,” said Tracie Kenyon, Montana Credit Union
Network President/CEO.
“We are proud of the real difference our organization is making in
our state working with all of our credit unions. On behalf of the 50,000
people we have helped avoid predatory loans, keep more of their
earned income, and open their first savings accounts, we thank the
National Credit Union Foundation’s Awards & Recognition Committee
for choosing the underdogs for this award.”
To the left are scenes from the awards ceremony.
• Tracie Kenyon and Jeanne Saarinen, MCUCD Executive Director,
pose with NCUF Executive Director Stephen Delfin and the Herb
Wegner award.
• Tracie receives congratulations from Delfin and NCUF Board Chair
Allan Kemp McMorris.
• Jeanne Saarinen delivers a short acceptance speech outlining
MCUCD's programs and—in true Awards Night style—thanking
Montana's credit unions and everyone who has contributed to
MCUCD's success.
• Karen Smith, MCUCD Director of Outreach Services, and Robert
Coble, MCUCD Program Support Coordinator, joined Tracie and
Jeanne on stage.
Montana's Credit Unions
for Community Development receives
the 2009 Herb Wegner
Memorial Award
for Outstanding Organization
network news—15
Presort Standard
US Postage
PAID
Helena, MT 59601
Permit No. 221
1236 Helena Ave • Helena, MT 59601
Directors
Conference
August 13-15, 2009
• Listen to fantastic, knowledgeable speakers , including
• Ron Parker—CPA and retired
Partner of Clifton Gunderson, LLP (CG)
• Loren Soft­—Consultant , Yellowstone Resource Group
• Ron Galloway­—
professional speaker
• Network with your peers from other Montana Credit Unions
• Relax at the beautiful KwaTaqNuk
Resort in Polson, Montana
Montana
Credit Union
Network
Jack Gladstone
• Enjoy the sounds of Jack Gladstone, Native “Poetsinger” and lecturer from the Blackfeet indian nation of Montana.
Registration will be available online in mid-June at :
www.mcun.coop
1236 Helena Avenue
Helena, MT 59601
Phone
406.442.9081
800.745.5546
Fax:
406.442.9085
Web Site
www.mcun.coop
network news—16