ARLINGTON, Va.-NAFCU's New Year's resolution seems to be `offer members more.' While NAFCU will still convey the credit union story on Capitol Hill and lobby for regulatory relief in the halls of NCUA, the organization is also shifting its focus to offer members more bang for their buck. One area in particular that NAFCU will be ramping up is its offerings for credit unions involved in mortgage lending. "Credit unions are in a competitive market with respect to mortgages with other financial institutions. To the extent we can make them more competitive in the market that helps," NAFCU President and CEO Fred Becker said. Referring to the deal that NAFCU cut with Fannie Mae last year, which includes a discount on Desktop Underwriter and other confidential items, Becker explained that there is a "maturation" in the housing market. Most upper and middle class families own their homes, but the underserved and low-income remain. "The benefit for them to continue to grow is credit unions' bread and butter: Dennis Dollar's Access Across America program for the underserved, minority, et cetera. At the same time it has to be recognized that credit unions have to be able to eventually sell that paper the secondary market and therefore it has to meet Freddie (Mac) and Fannie's standards. Freddie and Fannie are both important to credit unions in the sense that they provide us this aggregation, although our deal's just with Fannie, to get it to the secondary market." Becker said that in one credit union's case, it experienced more than six-figure savings from NAFCU's alliance with Fannie Mae. He noted that some have criticized Freddie and Fannie for entering the subprime market, but credit unions and the government-sponsored enterprises need each other to fill this niche. "It's very rewarding to be a niche player in a niche industry," NAFCU Services Corporation President and CEO Keith Nolan said. "If you're good at it, it's extremely rewarding." Becker also pointed out that statistics have demonstrated that the institution that owns and services a household's mortgage are more likely to have those members return for other services, like checking, savings, and other products. Another way that NAFCU plans to lend a helping hand to its members in 2003 is through NSC. Historically, NSC has not provided material benefits, according to Becker. However, NAFCU's wholly owned subsidiary, has begun taking bids and offering discounts and other deals from various vendors to its members. Through 13 `preferred partners,' three of which were added last year, NSC is able to send out requests for proposals and garner benefits for its members it has never done before. "My responsibility, being a wholly-owned subsidiary, is trying to add value to a credit union that's part of NAFCU membership," Nolan said. While small to medium credit unions typically benefit the most, NSC's Prime Alliance partnership offers three tiers of service to aid any size credit union. NSC's goal is to stay one step ahead of the market place. For example, NAFCU stayed up to speed on NCUA's incidental powers rule and within a month of it being finalized, NSC was one of the first to market debt protection. The first product to be reviewed by the NSC and NAFCU boards for 2003 will be overdraft protection, according to Nolan. "We want to help you position yourself for the future," Becker said. We want the product "on your door as soon as you're ready to go." NAFCU's new and continued focuses will aid members in being more competitive. One item that sets credit unions apart from other financial service providers-and aids them in the marketplace-is their non-profit, tax-exempt status, which is something NAFCU will "continue to vigorously defend" into 2003. Though there is no effort among lawmakers in Washington to tax credit unions, the bankers are still pushing it at every turn. "As you look long term, you can never put your guard down," Becker said. NAFCU Senior Vice President and General Counsel Bill Donovan commented that even though no one is currently talking about taxing credit unions, NAFCU must be "vigorous in our vigilance in defense of the credit union tax exemption." Brad Thaler, NAFCU director of legislative and political affairs, added, "We're always defending it. The bankers will take a shot at it every chance they get. Any time you have a new Congress, you have new members of Congress, new members of the Ways and Means Committee in the House, Finance Committee in the Senate, there's work we will be doing to talk to those members to make them aware of the issue, respond to the bankers' attacks on the tax status. So it's an ongoing process." "The reason why nobody has put forth plans to tax credit unions is because if you do your homework everyday.their arguments get no traction. It's when you don't go out and vigorously defend it.if you're a new member of Congress and you hear the bankers say all these things, but you never hear the other side of the story, sometimes things might begin to stick," said Thaler. One avenue of helping credit unions defend their tax-exempt status is to be able to demonstrate service to their communities. While Becker feels a study inappropriate because there is no way to uniformly collect the data, he feels that credit unions need to tell their stories more, beyond anecdotes. He held up NAFCU Board Member and Coastal Federal Credit Union (Raleigh, N.C) President and CEO Larry Wilson, who gave a loan to a Ukrainian immigrant couple who had been turned down by banks. By working with them through personal loans and eventually business loans, they now own two restaurants. Coastal uses this example of serving the underserved in its marketing. Becker also emphasized that that couple should also still be considered underserved, even though they have grown beyond their meager beginnings in America. "They wouldn't be there but for the credit union," he said. NAFCU is also working to help members expand their business lending programs or even break into it. NAFCU Director of Regulatory Affairs Gwen Baker explained that the trade group has been working to increase member education, particularly on lending issues and learning how to participate in Small Business Administration-backed lending. Additionally, NAFCU is looking at various avenues of getting credit unions eligible for loans, both regulatory and legislatively. Donovan said the group has ongoing dialogues and meetings with SBA. Additionally, Thaler said his lobbying team is continuing to push the issue on Capitol Hill. Education is really key to NAFCU, and NAFCU officials are not afraid to say their conferences have "become staples in the industry." NAFCU started a new security conference in 2002, which it decided was worth repeating. NAFCU Certified Compliance Officer courses have waiting lists, as does their Management Development Institute. A day of NAFCU's credit management workshop has been dedicated to mortgage lending. NAFCU's renowned Annual Conference is constantly being tweaked from the comments received at the previous year's conference. "We want to see that you get enough return so when you're paying your invoice you're thinking about all the things that hit the bottomline at your credit union, and one of them is your education," NAFCU Executive Vice President Diane Swenson said. "We offer a really good program at a real good value, but [NSC's] program and discounts are going to make it even more tangible." The common thread through all these items is delivering more to the membership. To uncover what NAFCU's membership really is craving, the group is planning a membership survey that can be completed online where member CEOs, chairs, and other randomly chosen member credit union officials can list all their likes about the organization and what they would like to see more of. [email protected]

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