Monday, August 31, 2015

Teachers Credit Union Buys Naming Rights to High School Football Field

The buying of naming rights to arenas and sports venues is becoming a regular occurrence within the credit union industry.

The latest credit union to buy the naming rights to a sports venue is Teachers Credit Union (South Bend, IN).

The largest credit union in Indiana will pay $140,000 over the next 12 years for the naming rights to Freed Field at Penn High School (Mishawaka, IN).

The stadium will be called Teachers Credit Union Freed Field.

Read more.

Saturday, August 29, 2015


The Iowa Credit Union Division was granted authority by the District Court to place SCICAP Credit Union of Chariton, Iowa, into receivership and then tendered the receivership to the National Credit Union Administration.

Community 1st Credit Union of Ottumwa, Iowa, immediately assumed most of SCICAP Credit Union’s members, assets and loans.

The Iowa Credit Union Division made the decision to take over management of SCICAP Credit Union after determining the credit union was insolvent with no prospect for restoring viable operations on its own.

The credit union's most recent Call Report indicated that the credit union was well capitalized and profitable. This would suggest that fraud may have been involved with this failure.

At the time of liquidation, SCICAP Credit Union was a federally insured, state-chartered credit union with assets of approximately $2 million that served 858 members, according to the credit union’s most recent Call Report.

SCICAP is the sixth federally insured credit union liquidation in 2015.

Read press release.

Friday, August 28, 2015

The State of Alabama Seizes Alabama One Credit Union

Alabama's sixth-largest credit union is now under the control of the state.

The Alabama Credit Union Administration board voted on Thursday to take over Alabama One Credit Union and its $600 million in assets due to financial mismanagement and a number of improprieties involving several key executives and officers.

As part of the conservatorship, the CEO of Alabama One, John Dee Carruth, was dismissed.

The takeover was announced one day after Alabama One expanded its lawsuit against several top state officials to include Gov. Robert Bentley alleging that state officials conspired against the credit union.

Read more.

Conservatorship Order.

Thursday, August 27, 2015

Wescom CU Sponsors UCLA Athletics

UCLA Athletics announced on August 26 a new multi-year partnership with Wescom Credit Union making Pasadena-based Wescom “The Official Financial Institution of UCLA Athletics.”

The partnership will include co-branded fan experience enhancements, increased awareness of Wescom throughout the Rose Bowl and Pauley Pavilion and a presenting sponsorship of The Den, UCLA’s official student group. Additionally, Wescom will work with UCLA Athletics' Academic and Student Services team to develop, manage and enhance financial literacy programming for the nearly 700 student-athletes at UCLA.

Terms of the sponsorship were not released.

Read more.

Matz's Appointments with CU Trade Offiicals

Unlike Federal Reserve Chairman Janet Yellen, National Credit Union Administration (NCUA) Chairman Debbie Matz does not publish her appointment calendar.

However, under a Freedom of Information Act (FOIA) request, NCUA released Chairman's Matz appointment calendar for the first seven months of 2015.

The FOIA was limited meetings or calls with credit union officials from three national credit union trade associations -- the Credit Union National Association, the National Association of Federal Credit Unions, and the National Association of State Credit Union Supervisors.

According to information obtained from the FOIA, Chairman Matz had 16 meetings.

Interestingly, there were 3 calls with credit union officials in the days following her testifying before the House Subcommittee on Financial Institutions and Consumer Credit on July 23. She also had 4 lunches with credit union officials during the first 7 months of 2015.

Unfortunately, the topics discussed during these phone calls and lunches were not disclosed.

Below is her appointment calendar.

Tuesday, August 25, 2015

Alabama CU to Buy Huntsville Bank

Avadian Credit Union, formerly Alabama Telco Credit Union, announced that it is acquiring American Bank of Huntsville.

The Birmingham-based financial institution said it has entered into a definitive agreement to buy the Huntsville institution. The transaction, which has been approved by each entity's board of directors, is expected to close by late 2015.

The deal is dependent on shareholder and regulatory approvals.

Proceeds from the purchase and assumption transaction will be used to retire the debt of the bank and upon the dissolution of the bank, to return approximately $2 per share to shareholders. This includes repaying preferred stock issued by the U.S. Treasury TARP program.

Read more.

Read shareholder letter.

McWatters Urges Revisiting MBL Lending History Exception

In the August 2015 NCUA Report, Board Member McWatters urges credit union officials to write the National Credit Union Administration (NCUA) about revisiting the agency's stance regarding a credit union that has a history of primarily making member business loans (MBLs).

The NCUA Board currently has a proposal out for comment regarding its MBL regulations.

When Congress in 1998 put in place the statutory cap on member business loans, it provided an exception to credit unions that had a history of primarily making business loans.

NCUA's current position is that unless a credit union's history of making MBLs was already established “as of” the date of
the passage of the Credit Union Membership Access Act of 1998, a credit union could not take advantage of this exception.

However, McWatters believes that based upon "reasonable" legal analysis NCUA has the discretion to revisit this exception. Of course, it is his interpretation of reasonable.

McWatters wrote:

"I welcome this review of the MBL proposal and urge all interested credit union officials not to hold back in recommending changes to the rule that will improve MBL operations, consistent with Federal Credit Union Act and safety and soundness. This includes looking at the lending history exception."

It is troubling that McWatters introduced this idea of revisiting the lending history exception during the final days of the comment period on NCUA's proposed MBL rule, especially when this issue was not part of the original proposal.

This looks like the next avenue that NCUA will use to exclude more credit unions from the statutory MBL cap.

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