Credit Union Times - Centennial Edition - (Page I16) CeLeBrAtiNg 100 YeArS , SPeCiAL CeNteNNiAL editioN oPiNioN good Work by Credit Unions Should earn recognition From Congress and the President It was exciting to be in Manchester, N.H., and to be a part of the celebration marking credit unions’ 100th anniversary in the U.S. I’m very proud of the work credit unions have done in their first 100 years. As a movement, credit unions are solid, trustworthy financial enterprises with a compassion for our members that comes from being devoted to helping people. This winning combination has pulled credit unions through six recessions since 1980 and leaves us on solid ground as we enter our latest economic slide. Year after year–for 100 years– credit unions have been there for our members, and we have every right to be proud of our record of safety and service. Mark Hawkins is presiOn this, the 100th anni- dent/CEO of Altura versary of our founding in Credit Union in America, my most fervent Riverside, Calif., and is hope is that our century of immediate past chairgood work will be recog- man of the Credit Union nized by Congress and Executives Society. President-elect Obama’s top policymakers for our ongoing efforts to help ease the current economic problems. And, when those policymakers realize how well credit unions have served their memberships and the nation, they’ll make sure we are put in the right regulatory position to keep doing our important work. Make no mistake about it, this is a perilous time and we need a new approach to pull our economy out of the ditch for which we are headed. But the current approach being employed by policymakers is attempting to paint all financial institutions with the same broad brush. Unfortunately, the positive story credit unions have to tell is being left out of the conversation. Credit unions did not play a role in creating this huge problem but, in many cases, we are working hard to help correct it. It is respect and recognition from the Congress, the administration and from regulators for our continued good work that would add much to credit unions’ centennial celebration. Respect and recognition from policymakers would be key in establishing the legitimacy of credit unions in our financial system, and would spotlight the safety and strength credit unions represent. For example, the regulatory modernization report by U.S. Treasury is due out in April, and policymakers have talked of combining all the regulatory agencies into one body. My question is: Where are credit unions in all of this? It concerns me we are in danger of being overlooked in favor of regulatory (not to mention bailout) schemes that favor the very large institutional players that have been at the root of our current crisis. My hope is that the Congress, in its next very important steps, will demonstrate its support for what history has proven to be–yet again–to be among America’s safest financial institutions: credit unions! A recent article on www.gonzobanker.com entitled “Dear Barney (Frank), Ben (Bernanke) and Hank (Henry Paulson),” takes the point of view of a fictitious president of a $1.5 billion privately held bank in “Pleasantville, USA.” The fictitious bank president writes a letter to House Financial Services Committee Chairman Frank, Fed Chairman Bernanke, and Treasury Secretary Paulson. After pointing out that small financial institutions have better profitability and fewer chargeoffs than their big bank competitors, the small bank’s president makes this plea: “Remember that it’s the grassroots of our country that have and always had the power to bring us out of bad times.” Credit unions are synonymous with grassroots. But what can we do? Whatever we do, we can’t be quiet about it. We must talk to the leaders of our trade associations. Talk to our elected officials. Be knowledgeable of the issues, and when possible, get out to the training sessions offered by various organizations and become an active part of the solutions we desperately need. The rules of the game are taking a dramatic turn, but we don’t yet know how those changes will translate into new regulations that may transform the competitive landscape. We need to be a part of this important conversation. If we are, we can be more certain that credit unions will continue to make a positive difference in the lives of American consumers for the next 100 years. And now, a celebratory toast: “To some of America’s safest financial institutions: May our future years be our best years!” A timeline for the Credit Union executives Society 1962 The Credit Union Executives Managers Society forms as a department of the Credit Union National Association. Jack Mitchell is the first chairman. 1967 Executive Director Bob DeThorne hired. 1971 Executive Director (later, President) Mike Welch hired. 1972 Name changes to Credit Union Executives Society (CUES). 1975 Moves to separate headquarters; adopts own bylaws. 1978 Credit Union Management magazine launches. 1982 Frances Lesnieski named first CUES executive of the year. 1984 CUES Financial Suppliers Forum (now CUES Supplier Membership) established. 1987 CUES Directors Educational Forum (now CUES Director Membership) established. 1989 President/CEO Fred Johnson hired. 1993 Mission redefined to focus on professional development. 1995 CEO Institute launches. (Current university consortium members are the Wharton School at the University of Pennsylvania, Cornell University’s Johnson Graduate School of Management and the University of Virginia’s Darden Graduate School of Business Administration.) 1996 Directors Leadership Institute (currently at the University of Navarra’s IESE Business School in Barcelona, Spain) and www.cues.org launched. 1997 Twenty-six Certified Chief Executives (CCE) graduate from three-year CEO Institute program. 2001 CUES builds first owned headquarters. 2004 Advanced Leadership Institute launches in conjunction with Harvard Business School. 2006 CUES recognizes 111 up-and-coming credit union professionals as inaugural inductees into the CUES Rising 100. 2008 DLI-Governance is announced for June 8-11, 2009, at the University of Toronto’s Rotman School of Management. the Past gives Strength for Future When Pierre Jay, the first banking commissioner of Massachusetts, was successful in getting the first credit union act passed in his state, the cooperative movement was relatively unknown in the United States but had seen success in Germany, Ireland and Canada. Jay was convinced that cooperative financial institutions would benefit the United States and worked with the state legislature to enact the first state credit union act. The Massachusetts State Legislature was advanced in its thinking that credit unions could offer an alternative to loan sharks of the time and lend to people not otherwise served by a financial institution. Based on the example set by Massachusetts and Jay, several more states enacted their own state credit union laws, spreading the credit union movement across the states. The challenges faced by Jay and his fellow state regulators were very different than the challenges we face today. Jay and other state regulators worked to convince state legislators and the public that the idea of credit unions could work and that regulators could ensure they were safe and sound. State regulators and early credit union leaders were successful in their efforts to build a strong foundation for credit unions. Nearly 100 years later, thanks to the innovative and forward thinking examples set by Jay and others, the credit union movement continues to thrive and remains committed to its cooperative mission. However, even Jay could not have envisioned the modern day, technology-driven financial system or the sophisticated member service needs and current challenges of credit unions and credit union regulators. Today, we are confronted by an ever-changing and troubled financial market, complex compliance issues, capital and liquidity challenges and a competitive market. Further, we continue to face policy and legislative hurdles. The good news is that we can learn from our history and use our strengths to bolster the credit union system and ensure the success of the credit union movement far beyond its Mary Martha Fortney is president/CEO of the 100th anniversary. National Association of From the earliest days State Credit Union of credit unions, the states Supervisors. acted as laboratories for innovation for the credit union movement, much like they do today. Forwardthinking state legislatures immediately recognized the potential of credit unions. Others were hesitant at first to pass state credit union acts, until they saw the success of credit unions in the early credit union states like Massachusetts, New York and North Carolina. By the Great Depression, 42 states had passed credit union (continued on page 16) www.cutimes.com Credit Union Times, December 2008 http://www.cues.org http://www.gonzobanker.com http://www.cutimes.com
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