MAY 30, 2014
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Megaphone Former Speaker and GCUA Speak Out on Risk-Based Capital (Issue 1 of 5)
Letters from former Speaker of the House Newt Gingrich and Georgia Credit Union Affiliates were among the 1,850 letters NCUA received in response to its risk-based capital proposal.

 
     
  Runoff July 22nd - Get Out the Vote! (Issue 2 of 5)
Despite several high-profile races on the ballot, there will likely be a light turnout for the July 22 runoff election, giving Georgia's 1.9 credit union members an opportunity to play a serious role in deciding these contests.

 
  Credit Union Impact on Primary Elections (Issue 3 of 5)
Of the candidates supported by Georgia CUPAC/CULAC in more than 100 races in this two-year election cycle, 98 percent were successful in moving on to the general election.

 
  The Race Is Not Over: Credit Union Supported Candidates
in Runoffs (Issue 4 of 5)

Candidates supported by the credit union community are involved in six primary elections that remain to be decided in the July 22 runoff, so it's not too late for credit union people to make a difference.

 
  Alternatives to the Traditional Financial Institution Resonating with Millennials (Issue 5 of 5)
The Washington Post reported that nonbank entities such as Wal-Mart, T-Mobile and Google are beginning to offer banklike services and are winning attention from younger people, a group banks have struggled to attract.

 
 
 
Former Speaker and GCUA Speak Out on Risk-Based Capital (Issue 1 of 5)

GingrichFormer Speaker of the House Newt Gingrich, who supported credit unions in amending the Federal Credit Union Act in 1998, submitted a letter to NCUA on May 23rd regarding the risk-based capital (RBC) proposal, calling it "extraordinarily troubling."  Gingrich spoke out for credit unions after he was alerted to the pending issue for Georgia credit unions (and credit unions nationwide) by GCUA. 

Gingrich shared that "This is not what Congress contemplated NCUA should do to establish a Prompt Corrective Action regime," adding, "We never intended, nor even comprehended the possibility of higher risk-based capital requirements for well-capitalized credit unions than those that apply to adequately capitalized credit unions."  Per H.R. 1151, the FCU act directs the NCUA to set any risk-based component for the well-capitalized threshold no higher than the component for the adequately capitalized level. 
 
He continued, "If Congress wanted a different result, we would have indicated that. In fact, in other banking statutes, we did exactly that.  At the time of the 1998 statutory change, banks were already subject to risk-based capital ratio standards for both the adequate and well-capitalized classifications. However, both then and now, banks have a lower statutory leverage ratio and access to supplemental forms of capital," Gingrich wrote. Quoting the Federal Credit Union Act, he added, "The proposal thus creates a system that does not seem 'to take into account that credit unions are not-for-profit cooperatives' that 'do not issue capital stock,' 'must rely on retained earnings to build net worth' and 'have boards of directors that consist primarily of volunteers."
 
Gingrich wrote that "banks and credit unions are not the same, and we did not want NCUA to treat them exactly the same," urging the regulator to design a system that takes into consideration the unique nature of credit unions and applies the risk-based standards as Congress intended, at the adequately capitalized level. In addition to the letter from former Speaker Gingrich, at least 27 letters from Georgia were part of the 1,850 letters to NCUA detailing concerns with the risk-based capital proposal as it was drafted.  Click here to read the letter submitted by GCUA that was drafted with the help of the Regulatory Response Committee.

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VoteRunoff July 22nd - Get Out the Vote! (Issue 2 of 5)

Last week fewer than a million Georgians voted in the primary elections.  With more than 1.9 million credit union members in the state, the course of the elections can be impacted by your involvement!  Many high-profile races are headed to a runoff on July 22nd (see related article) and turnout will be low.  Please encourage your team to vote in the runoff; their vote can be the deciding factor.  For more information on how the runoffs work in Georgia click here for the AJC’s May 20th Runoff Primer

The below two articles discuss how credit unions made an impact on the elections, as well as how they can make an impact in the runoffs.  However, one simple yet powerful way in which your credit union can be involved and make a difference is to engage your members with ElectionWatch to encourage members to vote.  If you have not yet added this to your credit union’s website, please do so today. 

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Credit Union Impact on Primary Elections (Issue 3 of 5)

HandsGA CUPAC/CULAC supported more than 100 races for the two-year cycle, representing 100% of the Congressional districts, 54% of the state Senate districts, and 43% of the state House districts to create a large footprint of support and influence.  Out of the supported races, candidates backed by GA CUPAC/CULAC had a 98% success rate in moving forward to the general election (with six supported races yet to be determined in the runoff, see related article below).  

Credit union influence in elections is not necessarily tied to a “win,” but rather it is about being involved, being visible, and being a force in campaigns.   And credit unions across Georgia did just that to make a difference!  Below are some of the highlights of how credit unions physically supported campaigns

  • Rep. Jack Kingston (R) was one of several candidates for the U.S. Senate seat vacated by Sen. Saxby Chambliss; Kingston now advances to the runoff.  Credit union leadership met with Kingston prior to the primary, and Brian Akin with North Georgia CU coordinated a meet and greet in conjunction with his local Chamber of Commerce.
  • Previous state Sen. Buddy Carter (R) advances to the runoff for the 1st Congressional District seat (vacated by Kingston) after battling a crowded field of candidates.  The Coastal Empire Credit Union Chapter was instrumental in support of his campaign by hosting Carter at a chapter meeting.
  • Mike Collins (R) was one of seven candidates who vied for a chance to face off against general competition for the 10th Congressional District.  Collins, a board member of Associated Credit Union, advances to the runoff.  During the primary, credit unions hosted Collins at in-district branches to show support.  Thanks to CGR CU, Georgia United CU, MidSouth Community FCU, Peach State FCU, Pinnacle CU, and Robins FCU for holding tours. 
  • State Sen. Jack Murphy (R-Cumming) received the highest number of votes and now advances to the July runoff after facing multiple opponents.  His race was expected to be an upset, however, Georgia’s Own CU held a meet and greet prior the election to help move his campaign forward.  His campaign was one that was targeted for support due to his consistent support of credit union issues in the state Senate. 
  • State Sen. Nan Orrock (D-Atlanta) faced tough competition in the primary, but was victorious.  Anna Foote from The Coca-Cola Company Family FCU was instrumental in Orrock’s campaign, supporting her re-election efforts, and we are pleased to see her return to office.
  • State Rep. Mark Hamilton (R-Cumming) won his race by just over 1,000 votes, and was targeted for credit union support due to his consistent engagement on industry issues during the session.  Credit union volunteers from Associated CU, Georgia’s Own CU, LGE Community CU, and GCUA manned the phone banks on May 6th, with Georgia’s Own CU organizing an additional phone bank night on May 13th to support his campaign. 
  • State Rep. Brooks Coleman (R-Duluth) was the clear winner in a tough race where he faced two challengers.  As Coleman is one of four current legislators who sit on a credit union board, credit unions were engaged in his campaign:  Peach State FCU along with members of GCUA helped procure spots for signs in the district.
  • State House Banking Chairman Rep. Greg Morris (R-Vidalia) barely defeated his challenger by 70 votes in a race that he was projected to lose.  Prior to the primary, Interstate Unlimited FCU distributed yard signs in the district to help push him over the 50% mark.
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RunoffThe Race Is Not Over: Credit Union Supported Candidates in Runoffs (Issue 4 of 5)

Six of the supported candidates for office face a runoff on July 22nd, and much of the outcome will be dependent upon whose supporters show up to vote.  Why support these candidates?  These are individuals who have exhibited strong credit union ties or who have expressed support for credit union efforts. Voter turnout is typically low for runoffs, and in some of these races there is no general competition.  Credit unions have a great opportunity to provide meaningful campaign support in critical races, and your credit union can make a difference by sharing this information with your staff and/or membership.  One way is to run an article either in your July newsletter or on your website educating your members on the credit union system’s support of these candidates.  To see sample articles go to ElectionWatch and click on Credit Union Resources.  Below is a quick rundown of these six races: 

  1. Mike Collins (R) 10th Congressional District:  Mr. Collins has been a board member of Associated Credit Union for several years, and is in a runoff with Jody Hice for the seat vacated by Rep. Paul Broun.  As a credit union board member, Mr. Collins would be an asset in Congress as he is familiar with and supportive of credit union issues.
  2. Buddy Carter (R) 1st Congressional District: Prior to entering this race for the seat vacated by Rep. Jack Kingston, Mr. Carter served a state Senator.  Mr. Carter is well know by several credit union officials in his district, and has been very accessible to credit union lobbying efforts at the statehouse during his tenure.  He faces Dr. Bob Johnson in this runoff.
  3. Bob Barr (R) 11th Congressional District: As a U.S. Representative in the late 1990s, Mr. Barr came out early in support of H.R. 1151 to back credit unions.  At Georgia’s request, he introduced legislation to expand the number of NCUA Board members from three to five, and has supported credit unions in a variety of ways throughout his career.  He faces former state Sen. Barry Loudermilk in the runoff.
  4. Jack Kingston (R) U.S. Senate:  Congressman Kingston supported H.R. 1151 in 1998 to support credit unions, recently co-sponsored H.R. 1553 on exam fairness, and has been accessible to Georgia credit unions in D.C.  He recently signed onto the letter to NCUA asking the agency to carefully consider changes to the Risk-Based Capital proposal and its impact on consumers.
  5. PK Martin (R-Lawrenceville) 9th State Senate District: State Sen. Don Balfour was the incumbent candidate in this race, and was the highest ranking state lawmaker to lose in this primary.  Mr. Martin has strong ties with Peach State FCU, and understands firsthand the value of credit unions in the district.  He faces Mike Beaudreau in the run-off.
  6. Jack Murphy (R-Cumming) 27th State Senate District: Sen. Murphy is the incumbent in this district and, although he participated in a very crowded primary, advances to the runoff with Michael Williams.  Mr. Murphy has been supportive of credit union initiatives in the state legislature, speaking out for issues that are positive for the industry and speaking against those that would negatively impact the manner in which credit unions serve their members.  His continued accessibility and support of our issues is important in our efforts at the Capitol.
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MillennialsAlternatives to the Traditional Financial Institution Resonating with Millennials (Issue 5 of 5)

The Washington Post reported on May 27th that the banking competition is coming fast in the younger demographic, and from a direction that may be unexpected to some.  The article highlights competitors such as T-Mobile, Wal-Mart, Google and a host of other companies that are now operating like banks.  These entities are gaining footing in the banking world with prepaid debit cards that customers can use to pay bills, make purchases and deposit checks via a smart phone camera – all the things one can do with a traditional checking account. And they are piquing the interest of a highly coveted group that traditional banks have struggled to attract: young people.

A new survey of nearly 4,000 Americans by Accenture found that 72 percent of people ages 18 to 34 would bank with Wal-Mart, Google or T-Mobile if they offered banking services. Of the nearly two dozen companies that researchers asked about, people were most willing to sign up with Square or PayPal because of the relationships they already have with the companies. Nearly one-third of those polled said the same about T-Mobile, Costco, Apple and Google.  These companies possess a few things that could really pose a threat to banks: an existing customer base, scale and an ability to quickly adopt new technology.

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