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CURRENT Newsletter | 4 May 2021

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Financial Services / Economy

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News From Credit Unions

Headlines

Marketing Mixer Set for May 5

The Marketing and Business Development Council of Virginia will be hosting a FREE Marketing Mixer on May 5 from 4 p.m. – 5 p.m. Join your peers to discuss timely and relevant topics including Strategies for Growing Loans and Getting Back to Normal and Showing Up at the Office!

Marketing Mixers are designed to be informal discussions, and we encourage you to grab your drink of choice (a margarita in honor of Cinco De Mayo is fitting) and join your peers for an hour of professional networking and fun.

If you have additional discussion topics, please email them to Nicole Widell and we will add them to the agenda.

Join us for a chance to win one of two $25 Grub Hub Gift Cards. You must be present to win!

Register for the Marketing Mixer Here.

Turnkey Mortgage Solutions: Learn More About Our Partnership with CUMA During May 12 Webinar

Looking for a turnkey, customizable mortgage solution for your credit union? Credit Union Mortgage Association (CUMA), your League's newest business partner, boasts a 40-year track record of providing best-in-class mortgage-related services to credit unions of all asset sizes, including origination, processing, underwriting, servicing, closing and secondary market access.

Join us for a May 12 webinar (at noon) to learn more about CUMA and what they can do for your members!

CUMA is a full-service mortgage company, owned 100% by credit unions, exclusively serving credit unions.

Learn more about our partnership.

May 19 Meeting on State’s Broadband Internet Initiatives; Role CUs Can Play in Boosting Access

For the past two years, your League has been part of the Commonwealth Connect Coalition, which has brought together more than 80 groups dedicated to bringing universal broadband to Virginia within a decade.

On May 19 (9:30 a.m.-10:30 a.m.), the Coalition will join us for a virtual informational meeting on the role credit unions can play in advancing universal broadband access.

Register here.

Access to high-speed internet touches almost every aspect of daily life and is a necessity for participating in modern life, a point driven home during the pandemic. Broadband access was a recurring theme in the calls we hosted with federal lawmakers and state lawmakers debated a half-dozen broadband bills this past session, half of which became law.

The Coalition is now soliciting financial support from businesses across all industries to gain access to federal funding to support the expansion of and access to broadband service.

“We believe this is an important initiative that supports our communities -- providing resources, access to services, education and so much more, including easier access to the wealth of services offered at our credit unions,” notes League President Rick Pillow. “As this initiative advances at both the state and federal levels, we believe it’s critical that credit unions are engaged and active supporters.”

CUNA Mutual Group Webinar: Navigating the Regulatory Landscape

CUNA Mutual Group is offering the following training opportunity on May 19: Navigating the Regulatory Landscape. Join this session to get tips for managing the latest regulatory and compliance trends.

Southeast CUNA Management School Going Virtual for 2021

Although many things have changed in the past year, Southeast Regional Credit Union Schools’ (SRCUS) commitment to providing an outstanding educational experience for credit union professionals remains strong, and in this spirit, is delighted to announce that registration will open soon for the VIRTUAL 2021 Southeast CUNA Management School.

While there will be some things that look a bit different from the traditional on-campus program, participants will also experience many of the same amazing opportunities that the in-person program offers.

Learn more

'Building Financial Health for a Brighter Tomorrow’ is This Year’s International Credit Union Day Theme

On Oct. 21, 2021, credit unions worldwide will celebrate International Credit Union Day (ICU Day). This annual event raises global awareness for the credit union movement through outreach, volunteering, fundraising and other ICU Day-themed activities. Credit unions bring financial inclusion and a promising future to people all over the world. Since the first celebration in 1948, ICU Day is a chance to spotlight and celebrate these achievements.

“This year’s theme for ICU Day is ‘Building financial health for a brighter tomorrow,” said Ariel Bilskey, director of blended learning at CUNA. “Financial well-being for all is a shared commitment among America’s credit unions, Leagues, and CUNA.”

International Credit Union Day is brought to you by Credit Union National Association and World Council of Credit Unions. This year’s event is proudly sponsored by Harland Clarke.

Learn more

Financial Services / Economy

Treasury Secretary Yellen Says Rates May Have to Rise Somewhat to Keep Economy from Overheating

Treasury Secretary Janet Yellen conceded Tuesday that interest rates may have to rise to keep a lid on the burgeoning growth of the U.S. economy brought on in part by trillions in government stimulus spending.

“It may be that interest rates will have to rise somewhat to make sure that our economy doesn’t overheat,” Yellen said during a economic seminar presented by The Atlantic. “Even though the additional spending is relatively small relative to the size of the economy, it could cause some very modest increases in interest rates.”

“But these are investments our economy needs to be competitive and to be productive. I think our economy will grow faster because of them,,” she added.

Since the Covid-19 pandemic broke in March 2020, Congress has allocated some $5.3 trillion in stimulus spending, resulting in a more than $3 trillion budget deficit in fiscal 2020 and a $1.7 trillion shortfall in the first half of fiscal 2021.

Learn more

Fed’s Powell Embraces Idea of CRA for Nonbanks

Federal Reserve Chair Jerome Powell indicated his support on Monday for subjecting non-depository institutions to the Community Reinvestment Act, but said the final decision should be left to Congress.

The Fed has been in talks with the other banking agencies for years to reform implementation of the anti-redlining law. The Office of the Comptroller of the Currency issued its own CRA reform rule last year, and the Fed released a reform outline in December.

While the banking regulators can’t expand the scope of CRA without authorization from lawmakers, Powell said Congress may want to consider an expansion of the law as lending continues to move outside of the regulated banking sector. (American Banker, May 4)

Personal Bankruptcies are Down, Money Woes have Eased — For Now

The degree to which U.S. consumers’ financial health got a boost from the pandemic relief efforts is coming into focus. The looming question is what will happen next.

The average consumer’s financial well-being improved between June 2019 and June 2020, as fewer people reported difficulty paying their bills, and subjective levels of financial well-being rose, the Consumer Financial Protection Bureau said Friday.

Meanwhile, bankruptcy filings tumbled 38% to 473,349 for the 12-month period ended on March 31, the Administrative Office of the U.S. Courts said Monday.

The two reports highlighted the positive impact from government payments, forbearance programs and decreased consumer spending over the past 14 months. But the CFPB noted that much of the decline in spending meant that people had cut way back on things like visiting family and vacations. (American Banker, May 4)

Traditional SBA Lending on Upswing as PPP's Days Appear Numbered

As PPP enters what will likely be its final month, a large number of lenders are looking to make more traditional SBA loans. Bankers said demand for 7(a) and 504 loans is up sharply, spurred by enhancements embedded in the federal government’s stimulus efforts.

Guarantees for 7(a) loans were increased from 75% to 90%. User fees for 7(a) and 504 loans have been waived and the SBA has been making several months of loan payments for borrowers in both programs.

Through April 23, 7(a) originations were up 9% from a year earlier and 1% from the same period in 2019, totaling $12.8 billion. Originations of 504 loans were up 22% from a year earlier to $4.1 billion.

The 7(a) program enjoyed its best two weeks of 2021 between April 9 and April 23. More big weeks are likely to follow as the Paycheck Protection Program expires, said Tony Wilkinson, president and CEO of the National Association of Government Guaranteed Lenders.

“I expect the last half of May, June, July and August are going to be big months for 7(a) — and for the 504 program for that matter,” Wilkinson said. (American Banker, May 3)

Why are Complaints About Credit Bureaus Soaring?

Consumer credit has held up remarkably well during the pandemic, and household debt has shrunk. Even among consumers who have lost jobs or sustained other economic harm during the recession, credit card balances have fallen.

Yet the number of complaints to the Consumer Financial Protection Bureau about credit reporting issues soared last year. Equifax, Experian and TransUnion were directly named in 246,000 direct complaints last year, more than double in 2019. If one includes more general grievances about credit reporting, the number rises to 283,000 — which was 58% of all CFPB complaints, up from 44% the previous year.

The spike is a mystery especially given that the Coronavirus Aid, Relief, and Economic Security Act last year required financial firms to categorize certain accounts as current for consumers affected by COVID-19. Meanwhile, debt collection ground to a halt during the pandemic for various reasons, including temporary moratoriums imposed by states.

The trade group that represents the three big credit bureaus, the Consumer Data Industry Association, is denying blame for the increase and pointing the finger at credit repair firms. These firms are filing millions of complaints to deliver on their promises of boosting consumers' credit scores, the CDIA and some credit experts claim.

“They are using the legal structure of filing disputes as a tactic to remove accurate but negative information from credit reports,” said Francis Creighton, the CDIA's president and CEO. "Banks, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corp. and other regulators have not seen a decline in credit quality or any issues suggesting the credit reporting system is a problem. The problem here is credit repair." (American Banker, April 30)

Education & Training

A ‘Turnover Tsunami’ is Coming. Will FIs be Ready for It?

Human resources professionals within the banking industry and beyond expect 2021 to be a year of rampant job-hopping as workers reassess what’s important to them.

Some may be seeking a more robust benefits package, while others need more challenging work or opportunities to grow. Some may want to work in a fully remote environment, while others miss the camaraderie of in-person brainstorming sessions.

The disruption presents both opportunities and risks for banks. On one hand, they are well-positioned to pick up new talent that can help them bring in new business. But they also need to be mindful of the reasons people may be looking for new jobs in the first place. Burnout and disengagement are real, and banks that don’t address those issues risk losing top talent to competitors, bankers and industry experts say.

In March, the Society for Human Resource Management predicted a “turnover tsunami” once the pandemic ends, citing one study that estimated as many as half of all workers could be on the hunt for a new job this year. That study, conducted in February by the research group Achievers Workforce Institute, named better compensation and benefits and work-life balance as the top reasons U.S. and Canadian workers gave for wanting a new job. Notably, 23% also named work-life balance as their reason for staying put. (American Banker, May 3)

Cybercrime Prevention and Response Leads Upcoming CUNA eSchool with NASCUS

Credit union professionals can learn tactics in cybercrime prevention and response from industry professionals and stakeholders by attending CUNA Cybersecurity eSchool with NASCUS. A combination of live and recorded sessions will be held Sept. 3 through Nov. 9.

“Cybersecurity is everyone’s responsibility, from the board to frontline staff,” said Melisa Kallestad, director of compliance education at CUNA. “Cybersecurity remains an NCUA examination priority, and recent compromises of SolarWinds and vulnerabilities of Microsoft Exchange stand as reminders the growing pervasiveness of the cyber threat.”

CUNA Finance Council Virtual Conference Agenda Announced

The agenda has been announced for CUNA Finance Council Virtual Conference, May 18-20. Content for this conference has been set by the CUNA Finance Council conference committee for their peers, with a keen understanding of the challenges unique to the current climate and industry.

The conference will consist of 20 unique breakout sessions and five general sessions over three days.

Sessions include:

  • Decision-Making Perspective: Seeing Challenges from a Different Point of View
  • Safe & Sound Investment Options for Offsetting Benefit Expense
  • CFO Exchange: Leading in a Remote Work Environment
  • Effective Change Management Through Enterprise Risk Management

Attendees have the opportunity to earn 13 Continuing Professional Education (CPE) credits by attending the sessions live.

Scholarships are available to CUNA Council members to help with the cost of attending the conference. Deadline to apply is May 14.

For more information, visit CUNA Finance Council Virtual Conference.

Learn more

CUNA to Offer HR Compliance Training with Real-World Insights

Credit union HR professionals can learn to apply the latest complex, evolving human resources regulations at CUNA HR Compliance Certification Virtual School with CUDoctor Aug. 3 and 5.

“This training is focused on the credit union industry and the everyday challenges that its HR professionals face,” said Jess MacLagan, instructional design manager at CUNA. “It provides a complete understanding of changing labor regulations, allowing attendees to perform their role optimally and with confidence.”

The school also provides an opportunity to earn or recertify a CUNA Credit Union HR Compliance Professional (CUHRCP) designation.

Developed by and for HR professionals, CUNA HR Compliance Certification Virtual School with CUDoctor addresses the intricacies of HR laws with real-world case studies and approaches. Sessions will cover HR compliance requirements, hot topics, regulatory developments and skills to stay ahead of HR legal issues.

Diane Reed, presenter at the school and owner of CUDoctor, previews the event and shares what to expect: "This year's school is chock full of HOT HR topics including the application of analytics in HR and conducting HR Audits. I know attendees will not only gain a better understanding of their role at the credit union but will enjoy interacting with their peers throughout the world as they join us for CUNA's 2021 HR Compliance School."

To learn more, visit cuna.org/hrcc.

Operations

Virginia Minimum Wage Increase Effective May 1, 2021

Virginia's hourly minimum wage, stalled for more than a decade at the federal floor of $7.25, rises Saturday to $9.50 under a law that passed early last year but was paused as the coronavirus pandemic threatened to crush the state's economy.

The rate will gradually increase to $12 an hour by Jan. 1, 2023, under the law, which lays out a plan for it to reach $15 three years after that if the General Assembly signs off.

The laws were initially meant to take effect in July 2020. But Gov. Ralph Northam (D) and the legislature postponed the effective dates for 10 months as the pandemic first gripped the commonwealth. They said they wanted to avoid burdening businesses already struggling with the economic crisis brought on by the health emergency. As it turned out, Virginia weathered the pandemic better than expected. After bracing for a projected $1 billion shortfall in its two-year budget, the state wound up with a $730 million windfall as tax revenue came in higher than anticipated.

Learn more

Virginia’s New Overtime Wage Act: Employee Classifications

Although passed with little fanfare, the Virginia Overtime Wage Act (OWA) becomes effective on July 1, 2021. Employers should be aware of this new law because it makes misclassifying employees as exempt from overtime requirements much more costly.

In the past, Virginia relied on the federal Fair Labor Standards Act (FLSA) to ensure employees are either paid overtime or satisfy the conditions to be exempt from the law’s overtime requirements. However, the new Virginia OWA eliminates some traditional defenses employers have relied on to reduce damages if they, even inadvertently, misclassified an employee.

Learn more

News From Credit Unions

Northwest FCU Foundation Collects Over 41,000 Food Items for Children in Need

NWFCU Foundation, the charitable arm of Northwest Federal Credit Union, held its annual Food for Kids Drive from February1-March 31 in partnership with Giant Food to collect non-perishable food items for at-promise children. The Foundation received almost 42,000 food items and several thousand dollars in donations from generous credit union members, employees and corporate partners, including Whitney, Bradley & Brown, Inc. Giant Food customers at seventeen local stores generously bought and donated over 22,000 food items for this important initiative.

Learn more

ABNB's Robin Posey, Bianca Avery Honored By LenderSelect Mortgage Group

ABNB Federal Credit Union is proud to announce that two of its Mortgage Loan Officers (MLO’s), Robin Posey and Bianca Avery, have both won the prestigious national Top 20 Producers Award from the LenderSelect Mortgage Group. They were in an elite group of award winners who were recognized for their sales achievements out of more than 400 loan officers nationwide.

Learn more

1st Advantage Celebrates Grand Opening of Riverside Branch

1st Advantage hosted a ribbon-cutting ceremony in celebration of the grand opening of its newest branch, located inside of Riverside Regional Medical Center in Newport News.

The branch relocated from a previous location inside the Riverside complex and is now more centrally located for better access and convenience.

Learn more

Change is Inevitable, Don’t Be a Commodity

“Change will happen and it’s neither good or bad by itself, it’s how we react to it that matters,” said Joe Thomas, President/CEO of NextMark Credit Union in Virginia when speaking with Susan Mitchell, CEO of Mitchell, Stankovic & Associates and Founder of the Underground. “If we build change into our industry DNA, we can have some control over the impact on our members and communities.”

Ideas into Action to adapt post-pandemic:

  • Don’t Be a Commodity
    Transactional relationships define you as a commodity. Embrace the credit union mission. Meet the members where they need you.
  • Change is Inevitable
    Change is a process and not an event. Prepare, anticipate and strategize to control its impact on your organization.

Watch Joe’s Full Underground Chat

 



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