BOSTON-When setting up a call center of any size, one important consideration is who will staff it. Obviously, calls must be handled professionally if the call center is to be a success. This can be quite a challenge in an age of increasing Internet usage, said Chris Stanvick, a consultant with Kowal Associates Inc. of Boston. Kowal Associates, founded in the mid-'80s, is a firm that lends its expertise to financial institutions or other companies planning to set up a call center or wanting to assess an existing call center's performance level. One guiding principal in call center staffing: "You never, ever want your customer service representative to know less than your customer (or member)," Stanvick said. But even before staffing questions are raised, other things must be decided during the earliest stages of setting up a working call center. One of the first questions Kowal Associates consultants work to figure out is whether new clients want to do a totally in-house call center, or whether they would prefer to try to out-source all or part of their calls. For one thing, the expense of doing a call center can be daunting, Stanvick said. And often, a financial institution's staff has other projects that are too time-consuming to get involved in something as comprehensive as setting up a call center. "What Kowal Associates (and other consulting firms in other areas) can do as a company is help our clients to find partners to handle their calling for them," Stanvick said. One well-known New York City financial institution that has taken the approach of having its own call center, but outsourcing some of its calls as well, decided upon this approach because outside of urban areas like New York, high-quality service representatives are more available than in the city. "If you look out in the Midwest, you can find people who are very happy to have an office type of job, or a corporate job," Stanvick explained. "It's a great opportunity for any company to set up a call center either for internal purposes or if they would like to be an outsource provider of those services. But you will find that most call centers are going to be in areas of the country where there are lower and mid-income brackets." While one might find a call center in places like New York, Boston or other large cities, it becomes a challenge to staff them in areas where many potential employees have college degrees, or perhaps even advanced degrees such as masters of business administration degrees. So a company's regional location, therefore, would be one consideration in forming their own call center, because location has such an impact on the employee pool available. If the decision is made to outsource, this raises additional questions, Stanvick said. For one thing, call centers that accept outsourcing clients typically might have as few as just two of them, or as many as 50. Level of training for customer service representatives would depend upon the types of calls expected to be handled. "Certain programs demand dedicated representatives (representatives who only work on one company's program)," Stanvick said. "They don't work on anything else. But then you have programs where it only makes sense to have representatives working in a shared environment." The concept of sharing a call center often is most cost effective because facility, equipment and staff are shared. Service representatives will make better use of their time as they take more numerous in-bound or make out-bound calls during the time they are on task. "Typically, (in a shared call center) when you have dedicated reps either making out-bound calls or waiting for in-bound phone calls, depending what your volume actually is, you can tell them, `Hey, we have another client and it's a very similar product.' If we are able to share resources by allowing these reps to handle phone calls from several companies, then these companies will be paying out less for the service, and we'll be more efficient as a call center," Stanvick said. Another challenge to deal with-avoiding call center staff boredom. The challenge is "to create an environment in which they will enjoy doing their jobs, and also give them the ability to work on a couple of different things," Stanvick said. Because employee retention is an important part of building and staffing a successful call center, part of setting up such a center is to assess the tasks that staff would be required to do and then to hire people with the education and expertise to complete the task successfully. When the task is to sell a basic product, the service representative might merely be called upon to take basic information from buyers who may have seen an advertisement of a product and already have decided to purchase it. "You probably wouldn't want to have a dedicated work force handling those types of phone calls," Stanvick noted. "You are not really providing the customer with anything other than information as to when he might expect to receive what he has ordered." While setting up a call center is a big project, staff at a company such as Kowal Associates can help things go smoothly. Consultants with expertise in these areas might consider different angles of the project than a credit union's regular staff. "The first thing a consultant might do is look at what the client's needs are, or what the objective of the client's program is," Stanvick said. "Most companies have multiple programs. "You ask them to consider what might be the best channel for providing information to their customers, or for receiving information from them. You may find that having a face-to-face conversation with the people you are dealing with is the best way you are going to be able to get their information. "Or maybe it would be a combination. Maybe you need to do one part face-to-face, another part using the phone, and another part through the mail," Stanvick said. "So, now you are moving toward taking an integrated approach, where your customer (or member) is sending you e-mail, for instance. They might say something like, `I read that this product is available, and I am interested in it. Can you please call me?' Then you do a follow-up. That's the approach a lot of call centers are beginning to move toward." Once a credit union has researched their members needs (how to contact members, how they want to be contacted), then it's the time when company (or CU) staff probably will come to the realization that the telephone is going to play a large part in their communication with members or customers. Once the basics are established, then other questions come up. Would the call center be staffed 24 hours a day? How would emergency calls be handled? Do you want or need an integrated voice response system? "In the financial institutions industry, that is something people really enjoy now, the fact that they can call anytime and check pertinent information about their accounts, such as balances," Stanvick said. "Some people like to do these things without having to bother talking to a real person. But then, there are some times when you do need to talk to somebody, like, for instance, should you think you are missing money that should be in your account." As questions arise during the call center set-up process, credit unions might find that seeking outside help leads to answers. This provides the benefit of experience in a project where so many possibilities exist, Stanvick said. -lide@cutimes.com...

SOUTHFIELD, Mich.- For years, Service Centers Corporation has operated as Michigan's only credit union-owned shared branch and automated teller machine network. But as SCC enters its silver anniversary year, the company is also celebrating achieving a longtime goal - contracts have been signed closing two key regional partnerships that eventually could lead to taking the shared branch network nationwide. "We're obviously pretty proud of what we've achieved, because we had no models," said SCC President/CEO Daniel J. Balagna. "We were pioneers in this whole concept that began in 1975. "We've certainly come a long way over the years since our humble beginnings. Technology is dramatically changing the way members receive various services, and it's changing the way we must do business," Balagna said. "However, with all this new technology, we remain consistent in our vision of cooperatively supporting shared delivery systems that enhance each participating credit unions' value to its member relationships." Dave Adams, president/CEO of Michigan Credit Union League, said SCC has been an asset to the industry for many years. "We have a deep appreciation for the leadership and the innovation that SCC has provided to Michigan credit unions as well as to credit unions and their members throughout the country," Adams said. "The fact that they now serve 240 credit unions in our state comprising the vast majority of credit unions members served and the assets held by all of our credit unions shows what a tremendous job they've done of helping credit unions with one dimension of their service delivery challenge, which is having adequate facilities to serve credit union members face-to-face. "In addition to that, the role that Service Centers plays with the SC24 ATM network has been phenomenal. In addition to helping credit unions with their ATM networking in an environment where credit unions have a voice over the service features and the rules of the sub-network, more recently, SCC has played a catalyst role in helping form a selective surcharge alliance called the Credit Union ATM Alliance, which now links more than 700 ATMs owned by Michigan credit unions. This has helped credit unions give their members access to ATMs without the surcharge fees that they otherwise would pay at bank ATMs," Adams said. "We're very pleased to be partners with such a strong, successful, innovative company that is doing so well at helping credit unions with their electronic fund transfer needs in the State of Michigan," he noted, in extending anniversary congratulations to SCC. One key staff member who has contributed quite a bit to SCC's success has been Leigh Marciniak, senior vice president and chief network officer. Marciniak, who has been with SCC for 10 years, worked on the formation of the Credit Union ATM Alliance. As part of SCC's efforts of the last few years to take shared branching beyond Michigan's borders, one key project has been to bring its entire information technology infrastructure in-house. This effort began in the early to mid-'90s. "We always knew that there would come a time as service centers continued to expand and grow that we would want to consider transitioning our need to rely on Dearborn Federal Credit Union (one of a small group of SCC-founding credit unions) or anyone else, taking full control of our technology infrastructure at that time," Balagna said. In the past, SCC had contracted with Dearborn Federal Credit Union, now a $1 billion-asset FCU, and its CUSO, Dearborn Financial Services, for its information technology services. This arrangement worked well for many years. But after signing on recently with Financial Service Centers Cooperative and Credit Union Services Corporation, SCC staff realized that, to achieve a national shared branching presence, they needed to own and control their technology. "We've always owned all the software applications, but we never actually owned all the computer equipment or employed the people. That was all part of a package contractual relationship with Dearborn Financial Services," Balagna explained. It was a major stepping stone to SCC's success over the last 25 years that Dearborn officials were willing to use their technical structure to write the software needed to get to where they are today, Balagna noted. J. Ronald Unger, president of Dearborn FCU, said it was all part of a common effort to serve members. "The shared branching network of Service Centers Corporation (SCC) has made it possible for us to offer greatly expanded branch and ATM services to members throughout Michigan and in neighboring states," Unger said. "As one of the founding member credit unions of SCC, we have always considered them an integral partner in our delivery systems." SCC officials anticipate that the technology link they are now working on to hook up with their two new shared branching partners, California-based Financial Service Centers Cooperative Inc. and Georgia-based Credit Union Services Corporation, will be in place about mid-year. "Within the past year, we've become an equal partner with both of those organizations to basically form a national network of shared branches among our three organizations," Balagna explained. "The other two started that effort a couple of years ago, and we are now coming in as the third link to really complete this effort..." As SCC staff moves forward into this silver anniversary year, there will be plenty of occasions to look back over the years, as well as to keep a sharp eye on the future. During the last year, SCC newest product offerings have included SC24's MasterMoney debit card and "PC Branch," Balagna said. More than 100 SCC member CUs now offer SC24's MasterMoney debit card to their members. Another 30 or 40 CUs plan to add PC Branch, SCC's home banking and electronic bill payment service introduced last year. "Our next major project that we'll have in place before June 30 is our lending origination and automation system for our branches," Balagna noted. "That will enable any member of our credit unions to walk into one of our shared branches and have our own shared branch staff be able to approve on the spot and close that credit union's loan..." That technology will be able to automate the credit scoring process, where each CU could have its own scoring mechanism, or a generic scoring mechanism to allow members to fill out an application at a shared branch. Then, once the information is entered by a shared branching service representative, there will be the capability to automatically dial up the credit report and bring that into the system. The score that is achieved will allow the loan to be approved if in a certain range, Balagna said. "If it doesn't fall in that range, then we can refer the member back to his or her own credit union," he said. In another recent development that will expand SCC's service, Michigan State University Federal Credit Union, a Michigan-based ATM deployer and card issuer, and SCC have reached an agreement in which MSUFCU will convert its ATM program support activity to SC24, officials said. This adds Michigan State University FCU's 70 or more ATMs to the SC24 network. "One thing is sure," said Kenneth H. Laubenstein, MSUFCU president/CEO, "MSUFCU members count on ATMs to handle their day-to-day transactions. Partnering with SCC is a way in which we can substantially improve ATM access to our members, particularly those in the Detroit-Metro area. Offering machines that members can access without cost is important. Consumers are busier than ever; convenient access to their funds is necessary." During the late `60s, the idea for a network of shared branches and ATMs came up as a reaction to predictions that there soon would be a "checkless, cashless society," Balagna recalls. "ATMs were just coming into existence then," Balagna explained. "And credit unions didn't even have branches at that point. We became the first CUSO in the country before that word ever was even used." Then, as the early `80s dawned, there was a need for a more efficient way of linking branches. "At that point, we asked (others) for help setting this up, but help wasn't ever received. So, we decided we'd build it on our own," Balagna said. SCC moved quickly into its role of "catalyst and consultant" for shared branching networks nationwide. Its earliest CUs were a core group that included Dearborn FCU, Detroit Teachers Credit Union, Credit Union ONE, Telcom Credit Union and Michigan Educational Credit Union. Today, SCC serves 240 member CUs. SCC's first shared branch opened 25 years ago in Riverview. Since then, 23 other offices have opened, 20 within the state of Michigan. Also, through an alliance with Encore Branch Services Corp., three more have opened in Virginia and Maryland. SCC now serves the needs of more than 3.5 million CU members, at CUs with combined assets exceeding $17 billion. It was as early as 1984 that SCC was able to link its ATMs into an early network. Another milestone was reached when SCC introduced its debit program about four years ago. As that program grew, members found themselves with "access to thousands of merchants around the world by using a debit card to access checking accounts as opposed to credit," Balagna said. "Right now, our off-line debit program is expanding at a dramatically higher pace than ATM volume. We're still seeing significant increases in ATM volume, but ATM debit, or the point of sale (POS) debit, I should say (MasterMoney debit program) is growing very quickly. We expect this year to authorize almost as many off-line debit transactions as we will on-line ATM transactions..." Service Centers Corporation was one of the first debit programs in the country to link on-line the authorization site of that POS debit. Up to that point, the use of debit around the country had basically involved off-line authorization and settlement. "The authorization comes through on-line through our switch, and we go into the credit union data base to make sure the member has the funds before authorizing the transaction," Balagna said. While funds are not immediately taken out of the account, risk still "is mitigated significantly." SCC staff are looking forward to celebrating the successes of their first 25 years at SCC's annual meeting May 23 and during other events such as the open house for a new branch planned for mid-February. SCC's efforts were spotlighted four years ago when CUNA & Affiliates chose SCC as recipients of the Herb Wegner Memorial Award. SCC was the "first organization" to get this award, said Balagna, who has served as SCC president/CEO since 1981. Today, as more offices open and increasing transactions are made by members (9.3 million last year, with almost 10 million projected for 2000), Balagna and others who had a hand in building SCC from the ground up are pleased with the results of their years of work and experimentation. "We knew early on that we had an exciting, unique concept!" Balagna said. -...

SALT LAKE CITY - A little more than a year after the Utah Credit Union League, at the height of their field-of-membership legislative fight with the Utah Bankers Association, collected more than 104,000 signatures from residents in six weeks on an initiative bill that would have allowed credit unions to maintain their existing FOMs, the Republican-controlled Utah legislature on Feb. 2 moved to make it more difficult for state residents to exercise direct democracy through ballot initiatives. In a surprise action on the state House floor, legislators passed by a vote of 49-20 substitute bill-H.B. 220-sponsored by Speaker of the House Rep. Mel Brown (R-Murray) that requires petitions from voters from each of Utah's 29 counties, rather than the current requirement of 20 counties, to put a proposed change of law on the ballot. The measure also eliminates the ability of residents to force the legislature to deal with an issue through initiative petition. Current law requires petitions signed by 5% of votes in the latest gubernatorial election to put an initiative before the legislature, and 10% to place it on the general-election ballot. "There is a strong sense in the state legislature that initiatives usurp the power of the legislature," said Tracie Kenyon Karls of the Utah Credit Union League. "This is a clear reflection of that attitude." Utah is one of only 28 states that allow lawmaking through initiatives bills. The right is guaranteed by the state Constitution, but details on how many signatures are needed and from how many counties is addressed only in statute. "The Utah Credit Union League is a well organized group, but can you imagine what could happen with a smaller, less organized group?" Karls asked. "If Rep. Brown's bill passes, securing the required number of signatures for an initiatives bill could prove to be so costly that it would be considered a luxury, instead of a citizen's right." At press time, H.B. 220 was in the Senate and Karls said the Utah CU League has met with the sponsor of the bill on the Senate side - Sen. Michael Waddoups (R-6). She explained that the senator has made assurances to the league that he is in favor of keeping the number of required counties at 20 and has promised he will kill the amendment if he cannot pull the number back. "At this time we don't want to do anything to impact our relationship with Senator Waddoups," said Karls. "We have a solid relationship with him and we believe his word is valid. The league will continue to monitor the bill and if it becomes necessary, we will issue a call to all credit unions for action. Right now, as the sponsor of the bill, Sen. Waddoups has the ability to kill it and there is no reason at this time for us to doubt his word." -...

ST. LOUIS, Mo. - More than 80 friends of John Gallagher, including credit union representatives and state legislators, turned out at a banquet on Feb. 10 to make a good-bye toast to the former president/CEO of the Missouri Credit Union System and to honor his 34 years of service to credit unions. Among the crowd of Gallagher admirers were State Reps. Chris Liese (D-85) and Timothy Green (D-73)-sponsor of the Missouri Credit Union Bill which passed in 1998- and State Sen. David Klarich (R-26). They each took turns at the microphone congratulating Gallagher for his vision and perseverance in the legislative arena and for educating them about credit unions. NCUA Board Member Yolanda Townsend Wheat was also on hand to present Gallagher with a special commendation recognizing his years of exemplary service to the credit union community. Wheat applauded Gallagher's innovative ideas, resourcefulness and political acumen that she said helped make a positive difference in the lives of millions of Americans who are credit union members. -...

ARLINGTON, Va. - The jury is still out on NCUA's recently released final PCA rules and proposed risk-based net worth requirements for federally-insured "complex" credit unions (CU Times Feb. 9). For now at least, NASCUS does not expect the new rules and regulations to trigger a domino effect of credit union conversions from federal to state charter, or from federally insured to private insurance carriers. "If you had asked me three or even six months ago if there would be significant fallout from the PCA regulations, I might have answered yes. But now that we've had a chance to study the PCA rules and the proposed "complex" credit union rule, I don't see it as being that serious," said NASCUS President Doug Duerr. "At the very least, the new PCA regulations will change the way credit union managers work, they will have the effect of putting the regulator at the manager's desk. This is not so terrible. It's management's responsibility to manage the net worth of their credit union, it's what they're paid to do. "I know the credit union community wants to look at the 7% figure as being significant, but I don't have a sense that NCUA's PCA level for a well-capitalized credit union is unmanageable," he continued. Duerr pointed out that the 7% or above net worth ratio credit unions will be required to maintain to be considered "well-capitalized" is actually lower than what credit union regulators have typically encouraged credit unions to maintain. Many state regulators have encouraged credit unions to maintain a 10% and Duerr speculated that the 7% level was Congress' way of giving credit unions an extra 1% "cushion" over banks' required net worth level, recognizing that credit unions unlike banks cannot sell common stock. There is no question credit unions needed to move towards having statutorily required net worth levels and reserves to be in the position to deal with economic upturns and downturns, he offered. But "you'd really have to ask Congress where they came up with the figure of 7%," Duerr said, adding that "both NCUA and state regulators told Congress credit unions didn't need a 7% net worth ceiling." Duerr is also pragmatic about the new PCA regulations triggering a migration of state-chartered credit unions to private-insurance carriers. Sixteen states allow state-chartered credit unions to be privately insured, but only 14 offer private insurance. Ninety-one percent of state-chartered credit unions are covered under NCUSIF, and only 500 state-chartered CUs are insured by private carriers like American Share Insurance (ASI), CUIC (Credit Union Insurance Corp.) and Prosad Corp. "You have to remember that private insurance carriers like ASI want to cover healthy credit unions," Duerr said, "so a state-chartered credit union covered under NCUSIF shouldn't think that just by converting to private insurance that that means their net worth is not going to be watched." Duerr conceded though that the new PCA rules do put pressure on state-chartered credit unions to maintain their loan growth. To the extent that state-chartered credit unions are able to maintain their rate of loan growth they should not be impacted any more than federal credit unions by the new rules, he explained. As of June 30, 1999, state-chartered CUs loan growth was almost twice that of federal credit unions - 15.69% versus 9.73%, respectively. Membership in state-chartered credit unions is also increasing nearly twice as fast as that of federal credit unions - 7.87% and 3.03%, respectively. If state-chartered credit unions' loan growth slows, these credit unions stand to get hit harder than federal credit unions by the PCA regs, Duerr said. "Given the factors affecting a credit union's net worth and NCUA's net worth classification ranges, the new PCA rules mean credit union managers will have to use a lot more tools and make sounder projections on how long it will take to ratchet up their credit union's net worth," said Duerr. "The room for latitude has been removed." -...

WesCorp is first corporate U.S. CU to receive authority to implement derivative hedging program.............................Page 4...

NASCUS unruffled by NCUA new PCA regulations, but still aware of possible effects on state-chartered CU........Page 12...

SAN CARLOS - Benefit Consultants, a direct marketer of insurance, announced plans to move its operations from San Carlos to Nashville, Tenn....

CALABASAS, Calif. - In terms of number of financial clients, the new Digital Insight is the largest Internet banking provider in the financial services industry. Digital Insight announced that its acquisition of nFront, Atlanta, Ga. is complete. The new Digital Insight now has more than 730 community financial institution clients, with a total customer base of 17 million potential end users. These clients include 650 Internet banking contracts with 13.6 million potential end users. More than 750,000 people are currently active end users of Internet banking. "We successfully executed a carefully planned integration process bringing the best of both companies together," said Digital Insight Chairman, President and CEO John Dorman. Other highlights of the deal include the following: * Combined annualized revenue of approximately $26.3 million at the end of the fourth calendar quarter in 1999. * Interfaces with 45 data processing vendors providing coverage of more than 80% of community financial institutions. * New company has expertise in both real-time and batch processing. Digital Insight's headquarters remain in Calabasas, Calif, with regional operations in Atlanta, Ga. Digital Insight's staff now has approximately 325 employees. Digital Insight trades on the NASDAQ under the symbol DGIN....

PLANO, Texas - EDS continued the sell off of its once extensive ATM network....

ATLANTA and NEW YORK- Continuing the trend in the development of electronic payment solutions, Equifax's Check Solutions unit and Intell-A-Check Corp. have sealed an alliance that company officials say will offer consumers and retailers a one-stop check payment solution, including identity verification, quick check approval, and the creation of a check draft or an Automated Clearing House (ACH) file for final settlement. The combination of check settlement software from Intell-A-Check, a leading provider of electronic payment solutions, with Equifax PayNet Secure will allow consumers to pay by check without ever actually writing a check. To pay by check, on-line shoppers enter their checking account information into a secure form on the merchant's Web site. Company officials say the system can approve and guarantee funds within seconds and create a check on the merchant's PC which can be sent to a laser printer or formatted as an ACH file for immediate electronic deposit....

WASHINGTON - Reminding members of the House Subcommittee on Financial Institutions and Consumer Credit on Banking and Financial Services that "as we learned in the late 80's, the deposit insurance funds stand between bank failures and the American taxpayer," FDIC Chairman Donna Tanoue urged the subcommittee to recommend a merger of the FDIC and Bank Insurance Fund....

ST. PETERSBURG, Fla.-Payment Systems for Credit Unions Inc. has held a ribbon cutting for its new operations center building, attended by more than 500 staff members and cardholders, including some from PSCU's five founding credit unions. "PSCU Service Centers became operational in 1989 with 840,000 accounts and currently we are servicing more than 5.5 million," said PSCU President Dave Serlo. "We were rapidly outgrowing our 80,000 square-foot facility as the cooperative association had enjoyed tremendous growth over the past decade." The new operations center has added 100,000 square feet of office space, officials said, and will house PSCU's 24-hour cardholder service unit and other services. PSCU, founded 22 years ago, is owned by more than 500 member CUs representing more than 5.5 million cardholders nationwide. PSCU provides "technology and cost-effective, high quality financial services and products solely to credit unions and their members," said a PSCU spokesman....

DALLAS-The nation's first regionally chartered corporate credit union will celebrate its 25th anniversary this year, said officials at Southwest Corporate Federal Credit Union. Chartered on Sept. 3, 1975, the corporate that has reached almost $4 billion in assets and serves 1,200 members began "with a handshake, $35 and a promise to pay close attention to the needs of credit unions," officials said. Through all the years that came after as the United States economy took its many up- and down-turns, SCFCU continued to expand member services. During periods of long lines at gasoline stations and inflation cycles, the S&L crisis and hype over Y2K, SCFCU "has remained true to its mission, which was service to its members," officials said. Through its expanded investment powers, SCFCU was able to develop a line of investment products that allowed CUs to increase their income. In the category of special share certificates, SCFCU offers "step-ups, amortizing and variable-rate certificates." When added to a CU's portfolio, these "mimic some of the features of the agency securities that are so popular, without the added administrative burden of actually owning the security, said Terry Young of SCFCU. A milestone was reached recently when SCFCU was granted a national charter, making it possible for a CU anywhere in the nation to join the corporate. Celebration festivities will begin at Southwest Corporate's annual meeting April 5 in Dallas, and continue for several months, Young said....

RICHARDSON, Texas - Texans Credit Union has become the latest credit union to reach the $1 billion-in-assets milestone. Texans CU was founded in 1953 by 11 Texas Instruments employees who each pooled $5 and petitioned the Texas Banking Commission to charter a financial cooperative for employees of Texas Instruments. At the time, Texans CU only offered share accounts and loans. Texans CU is now a full-service financial with 23 branches. In addition to serving employees of Texas Instruments, the credit union counts among its more than 135,000 members more than 200 select employee groups, 11 cities, the Richardson Telecom CorridorT, and Research Park in Austin. "I can remember when the credit union was just a desk in the personnel office of Texas Instruments," remarked John McCormack, one of Texans CU's founding members. "Who would have thought it would grow to this level? I'm proud to be the person who symbolizes Texans' move up to the next level."...

NEW YORK-"Direct Line," a cross-selling program designed to provide credit unions with "a key delivery channel" to market their products, is now available from Line One Teleservices. Line One Teleservices has provided marketing and consulting services for hundreds of financial organizations nationwide during the last five years, company officials said. "The Direct Line program uses highly trained telemarketers to call credit unions' members to talk to them about selected product offerings," said Frank D'Agostino, marketing manager at Line One. "It's a powerful marketing tool because once the telemarketer identifies a sufficient level of interest, the call is seamlessly transferred to the credit union's sales team, who can then close the sale. "This program has helped closing ratios and been successful in increasing the returns-on-investment for many of our traditional marketing programs," D'Agostino said. "Now, we can utilize it to make cross-selling programs more profitable. We are able to deliver excellent results while eliminating many of the expenses incurred from in-house telemarketing departments." For information, call (800) 923-5463, ext 223. -lide@cutimes.com...

VIRGINIA BEACH, Va.-Abacus Communications LC, a national e-commerce and teleservices call center company with headquarters in Virginia Beach, Va., has announced the opening of a new 106,000 square-foot facility here on Stemmons Freeway. "Abacus Communications continues to experience a high rate of growth in the call center and e-commerce service markets, and this facility meets our immediate expansion needs," said Abacus Communications CEO Rick Clay. "We are very pleased that our new facility is in Dallas, one of our target markets." Abacus Communications planned to recruit as many as 1,500 employees to staff this 600-seat call center that is operating 24 hours a day, 365 days a year. The center, which was to open in early February, will provide Internet customer service using proprietary Web-chat software, and inbound order processing for national clients, Clay said....

ORLANDO, Fla.-The CUNA Marketing Council's 7th Annual International Marketing Conference March 22-25 will feature a full list of guest speakers, roundtable discussions, workshops and marketing displays. Also on tap is the council's presentation of the Diamond awards for "the highest achievements in credit union marketing for the past year." Among the speakers attendees will hear from during the four-day conference is Thomas Faranda, president/CEO of Faranda & Associates. For additional information, visit the CUNA Web site at www.cuna.org, and then click on CUNA Marketing Council....

Can we agree that NCUA's responsibility, per the Federal Credit Union Act, is to "form" safe and sound," single, multiple or community group credit unions? Can we agree this survey was mailed to all "existing" federal credit unions who passed these charter requirements "long ago"? Is it not true that once we were vested with the powers of the Federal Credit Union Act, that it became "our" responsibility to "select" the services we provide our group and "not" NCUA's? Is it not true that all of us serve a group or groups of individuals with a name or names? Notice the title of NCUA's survey, "Service to people of Modest Means." Do we provide "service" to a "group or groups of individuals" name "People of Modest Means?" Let's be sure by opening our existing charters to the field of membership (FOM) section. Can you find them in your FOM? Of course not! This is the beginning of yet another "historic move" by NCUA. This voluntary survey is the invitation soliciting an agreement to the NCUA's beliefs. Beware! We can be held accountable when considering the answering of this survey. Notice the bait and switch tactics of NCUA. The very first question invites us to define the group of individuals in the title "People of Modest Means" as the "lower income members" of our existing group. Then with questions 9 and 11, this definition advances from lower income members to include a lower income group or community. We should say "no" to all of these questions. Questions 3, 4, 5, 6, 7, 8 and 10 all refer to how we provide "services" to this group of People of Modest Means. Is it not true that we shall be violating the spirit of the FCU Act and the NCUA's rules and regulations if we serve anyone other than the group or groups of individuals named in our field of membership? Well then, the survey is complete and we truthfully answered "no" to each and every question. The outcome of completing this survey can be dangerous. Will the stated numerical parameters become the future rule of qualifications for each new group or groups of individuals? Can it lead to special requirements for who qualifies to sit on our boards? Can it lead to providing services that NCUA deems necessary? Each credit union must decide how the "truth" addresses these questions regarding the present and future actions of credit unions and NCUA? Can we now see how serious these issues are? Do you believe NCUA has moved beyond the limits of their authority? How will the choices we are about to make lead to our demise? Perhaps it is truly better to be safe than sorry. All of us should answer this call. The question is, how should we respond? How do we provide a unified out, address our true beliefs, defuse the political pressure that currently exists on the NCUA Board and preserve our past, present and future freedom to choose according to the existing FCU Act? Why not consider returning the survey blank and attach this statement as follows, "We oppose any initiative to define the phrase people of modest means including how we should service them." Perhaps it is the fundamental right of each individual to decide whether or not he or she is of modest means - not NCUA, credit unions or anyone else. Since this survey has yet to reach us, please consider my concerns. Will "The Truth" prevail? David Stien President Crane FCU...

Don't lose faith, Mike! Just come to California. The credit union leaders are all around you. For the last five years, I have had the opportunity to serve on several key committees, the California Credit Union League Assembly of Delegates, and for the last year on the California Credit Union League Board of Directors. In every case, the group I served with was full of leaders. People who quietly took the riens and pulled everyone forward - some of them kicking and screaming pretty loudly. In the credit union movement there are many, many leaders. People outside of the movement don't see them because these people don't jump up and down and shout, "See me! See me!" they simply move all of us forward quietly and efficiently. To all of you "invisible leaders," thanks for all of your commitment to the movement and your vision. It has been a great and very rewarding experience. Pat Wagner President/CEO New World FCU...

In the credit union movement we talk a lot about cooperation. Thankfully, we don't just "talk the talk". We also "walk the walk." Perhaps one of the best contemporary examples of this cooperative spirit is found in the very dynamic environment of ATM networking. Cooperation is rarely perfect or as far-reaching as its potential, but in the realm of ATM networking, credit unions have done a pretty good job. Market influences demand that this cooperation continue. ATM surcharging is the most recent catalyst for re-examining the need for support for credit union-owned ATM networks. Debate over ATM surcharge fees has evolved and spread from state legislatures to Congress, and now back to state legislatures and even city councils. As consumer activists try to get government to reign in banks for charging high fees, banks are playing hardball. San Francisco and Santa Monica, California have already passed ordinances to ban surcharge fees. Other cities, large and small, are considering such ordinances. New York, Los Angeles, San Diego, Portland, Oregon, and other cities are talking tough. In response, bankers are rattling their sabers. When the widely publicized surcharge ban took effect in Santa Monica, California, last month, the two largest banks there, Wells Fargo and Bank of America, responded by barring non-customers from using their ATMs. In every market where a state or city is considering a ban, you can be sure that bank lobbyists are pointing out the potential for banks pulling their machines from public access. Representative Maxine Waters (D-Calif.) has sponsored one of the two more prominent ATM ban bills that were introduced in Congress in November of 1999. Rep. Waters predicted that banks will see "legislation and ballot measures all over the country," and that ATM fees are just the beginning. "I think there's going to be a big revolt against fees in general," she said. As banks pull their ATMs out of networks, or posture to do so, consumers certainly get hurt, but what about smaller institutions such as credit unions? Large banks seem to be increasingly content marketing their own ATM networks rather than the shared networks in which they participate. Surcharging has given them an excellent tool for doing so. As banks continue on this track, credit unions need a cooperative response that pools their ATMs and protects credit unions and their members from the ill effects of both surcharging and its potential effects on networks. In 1984 Service Centers Corporation in Southfield, Michigan expanded its efforts to enhance member access and convenience by launching its "SC24" ATM network. Today, the SC24 network serves the members of 210 Michigan credit unions with over 600 ATMs, a network that rivals the 700 ATMs owned by Michigan's largest bank, Comerica. Other credit union-owned ATM networks have formed and flourished around the country. Now more than ever, credit unions need to support their local, credit union-owned ATM network. Credit union leaders also need to continue to encourage interstate alliances between these networks. There are many reasons to support these networks. For instance, SC24, and most of the CU-owned networks offer deposit sharing. Over 12% of SC24's transactions are deposits. The cost of the deposit transaction to the issuer is less than half the cost that would otherwise be paid through direct participation in a regional network. In fact, most regional networks have either eliminated deposit sharing or are considering it because big banks don't want to process deposits because it weakens the value of their own proprietary networks. CU-owned ATM networks such as SC24 offer credit unions greater options for member account flexibility. With SC24, up to 20 different accounts can be accessed for transactions. Regional networks typically have a limit of 3 accounts. Cooperation and support of local, credit union-owned networks also gives credit unions representation with regional and national EFT networks with a collective clout that would otherwise be unattainable. So what should credit unions' response be to the challenges of ATM surcharging? A collective, unified, cooperative response is needed. In Michigan and the Midwest, SC24 created a selective surcharge program for its 210 member credit unions. In cooperation with the Michigan Credit Union League, this was later expanded to include a total of 700 ATMs, 70% of all ATMs owned by Michigan credit unions. And now, in alliance with other organizations such as Corporate One in Ohio, the CU ATM Alliance is expanding to include potentially 3,000 ATMs in the Midwest. Members of these credit unions will have ATM access, if and when big banks pull their ATMs as a result of city ordinances. And, best of all, the transactions will be surcharge-free, an added benefit of being a credit union member. The challenging nature of the current competitive environment will continue to incent credit unions to seek cooperative solutions, as they have done so well in the past. All credit unions should support their local ATM network. A unified front will serve credit unions well in this dynamic ATM marketplace....

At one time, there were over 24,000 credit unions. A large credit union was one that weighed in at or above $20 million in assets. Most were plain vanilla. How times and credit unions have changed. Before long the number of CUs will be less than 10,000, with 36 of those over $1 billion in assets and a high percentage of CUs full service. Many of the credit unions that have disappeared had much in common, including their attitudes towards change. Over the past 30 years, credit unions have discovered three basic ways to deal with change. Credit unions can choose to ignore it; or they can choose to fight it; or they can make a conscientious decision to embrace it. Not surprisingly, a high percentage of credit unions that are now history chose one or both of the first alternatives. The remaining credit unions, especially those that expect to continue to survive, chose the third alternative. Addressing these three views of change could make for an interesting session at a credit union's annual planning session. Volunteers and staff might be surprised to find out that they are not entirely in agreement with each other as to how their credit union and its leadership team feel about change and how they deal with it. The fact is that credit unions have a well-documented history of ignoring or fighting change rather than embracing it. Don't believe it? Here are some changes that credit unions at one time strongly resisted involving issues that are now taken for granted: * Share drafts. That's right, there were credit unions and national CU leaders who were adamantly opposed to credit unions getting into share drafts. "Checking accounts are for banks, not credit unions," was a cry frequently heard. "It'll never work. All my members already have checking accounts at a bank. Checking accounts are too much extra work." * Mortgages. When that battle first heated up, it seemed like some credit union officials firmly believed that, "God didn't intend for credit unions to do anything but payday, car, and debt consolidation loans." Big ticket loans, like for a member's dream house, should go to savings and loan associations because that's the business they are in. There was a feeling that such large loans would result in the credit union not being able to meet the demand for smaller, more traditional credit union loans. * Credit cards. Some credit union folks really had a tough time with this one. By issuing credit cards, they asked, weren't credit unions encouraging members to spend beyond their means and get into debt? And what about the higher interest rate? "Besides," claimed some naysayers, "we don't have the expertise to handle these things as good as banks can." * Risk-based lending. The argument, still going on in some circles, went like this: "All members should be treated equally. That's what makes a credit union a credit union. Risk-based lending violates credit union philosophy." * Indirect lending. See risk-based lending above. "Why should some members have to pay more because a dealer gets a kick back? Credit unions should not get into bed with car dealers because they can't be trusted," was not an uncommon comment. * ATMs. The current controversy revolving around ATMs concerns surcharging. At one time, the controversy was considerably more basic. The issue focused on whether or not credit unions could and should properly offer ATM service to members. Again, those opposed used the argument that this was simply not something credit unions should do. ATMs are for bank customers not credit union members. Besides, the logic at the time went, credit unions can't afford to purchase and maintain the machines like banks can. And the list goes on. Many credit unions also fought change involving drive-up facilities, debit cards, audio response systems, evening and weekend hours, CEO titles, employment agreements, and the need for full-time marketing and human resource professionals. Also, the corporate system, U.S. Central, CSG, select employee groups, community charters, modern facilities, branches, service centers, CUSOs, national share insurance, a host of technology advancements, and the creation of NCUA. And there are many more examples. Some would say that those days of resisting change are behind us. Really? Are today's credit unions ready to fully embrace, home banking, e-commerce, on-line originations, paperless board meetings, instant loan approval, new savings and investment instruments, state-of-the-art call centers, joint ventures, outsourcing, charter conversions, and much more? Looking back it is hard to imagine that there could have been so much resistance to things that have ultimately greatly benefited credit union members. Looking ahead, it is difficult to imagine if some credit unions will ever change for the benefit of members. So what is the greatest impediment to change in CUs? Some of the obvious answers include concerns for cost effectiveness, available expertise, uncertainty over member acceptance, and number one, fear of failure. On the other hand, resistance to change all too often boils down to the personal preferences or prejudice of credit union decision makers. In other words, if I as CEO or management staff or a CU policymaker don't personally embrace a particular change, then the chances of it being offered to members are pretty remote. I actually have heard credit union people say, "My members don't need to get mortgages (or whatever) from my credit union and they never will as long as I have anything to say about it." Note the use of the word "my" rather than "our." Can you imagine how such an individual will embrace the changes brought about by the Internet? Understanding change assumes that those in control can see the bigger picture, can focus on what business credit unions are really in, have the courage to take risks, can understand the consequences of ignoring or fighting change, and most important, are committed to doing what's best for members, not themselves....

JANUARY 1 - FEBRUARY 11, 1999 REGION...

BISYS, Little Falls, N.J., a provider of banking, insurance and mutual fund solutions and internet-based products and services, has named Christopher M. Guarino as president of its plan services division. CUMAnet, W. Patterson, N.J., has appointed Ira Oskowsky president. Online Resources & Communications Corp., McLean, Va., an outsourcing provider of privately-branded Internet financial services for regional and community banking institutions with more than 400 clients nationwide, has made the following appointments: Stephanie Chaufournier, senior vice president of product management; and Jovian Ho, senior vice president of information systems and technology. In addition, Online Resources has announced that Ervin Shames, former president of Borden Inc., has been elected to its board. Premier Systems, W. Des Moines, Iowa, a data processing service bureau serving more than 200 CUs in 30 states, has named Andrea McNeill training specialist, and Megan Shanahan client response center representative. PWCampbell, Pittsburgh, a professional design/build construction services organization, has named Glenn W. Grau regional vice president. Universal Assurers Agency Inc., Omaha, Neb., an administrator of property improvement and home equity guaranty programs to CUs nationwide for 25 years, has promoted Frederick J. Ostdiek to vice president/ national sales manager. Member Service Corporation, Franklin, Tenn., which recently moved to a new facility at 1117 Columbia Ave, a provider of insurance and financial products to CU members nationwide, has made the following appointments: Jim Short, executive vice president; Michelle Brozowski, director of operations; Daryl Bornstein, national sales director; Mike Newby and John Welch, regional sales managers; Cathy Aggen, director of customer service. Southwest Business Corp., San Antonio, an insurance and financial service provider to more than 1,200 financial institutions nationwide, has promoted Cynthia Williams to manager of corporate communications & publications....

First Financial CU, W. Covina, Calif., has named Jerry C. Harpstrite vice president of marketing. Point Loma CU, San Diego, has named Michael Alvarado IT manager, and Angela Haas Rancho Bernardo branch manager. The Golden 1 CU, Sacramento, Calif., has made the following appointments: Lisa Swanson, vice president of e-commerce; Cyndi Simpson, vice president of support services; and Cheryl Landrus, vice president of payment systems....

Diamond CU, Pottstown, Pa., has named Robert Slivka vice president of information technology. Roanoke Valley FCU, Va., has named Ben Laurendeau CEO. He succeeds Gardner Divers, who is stepping down after serving as FCU manager for 20 years. Workers CU, Fitchburg, Mass., has named Charles B. Troccia senior vice president and director of marketing....

Iowa League Corporate Central CU, W. Des Moines, Iowa, has named Jonathan Sarvis financial analyst. Iowa CU League, W. Des Moines, Iowa, has named Stacie Lightner education specialist....