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WASHINGTON – The Association of Corporate Credit Unions continues its metamorphosis. Some of its leaders say it’s becoming a more legitimate “association” and in some ways more on par with the big boys of CUNA, NAFCU, and NASCUS, though its mission is much narrower. “We’ve been around about 10 years and at first it was just a means of getting everybody together to talk about common issues, then it became more involved with working with the regulators on crafting regulations,” said Eric Kenealy, CEO of SunCorp Corporate CU and chairman of the ACCU. “Here most recently we have become more involved in legislative activities to ensure lawmakers know what a corporate credit union is, what our role in the credit union movement is. A lot of the effort has been spent working with the other trade associations – CUNA, NAFCU, NASCUS- to increase our profile with the lawmakers if you will,” said Kenealy. Congressional efforts will be top of mind for the 70 or so attendees expected at the ACCU’s Annual Meeting being held Oct. 2-4 in Arizona. This year all corporate CEOs will be in attendance, and each typically brings a senior staff member. One thing the corporate leaders will consider is increasing its pilot program for congressional visits where a corporate hosts a member of Congress from their state at the corporate’s headquarters. There were five such visits this year and it is now considering bumping it up to 30 (there are 29 corporates). “What we found is our members enjoyed the experience, and felt confident that after a member of Congress visited their shop they were in a better position later to talk to that legislator about important issues that may arise,” said ACCU Executive Director Mike Canning. Kenealy says the increased visits make sense given what’s happening politically. “I think the credit union movement is in for the fight of our lives over the taxation issue. Not only taxation, but also the attempts by the bankers to limit how credit unions can serve our members. We have to prevail with the lawmakers to ensure the continued viability of credit unions,” said Kenealy. Speaking of being politically active, the ACCU is just beaming over locking in Kevin Warsh, Special Assistant to the President, as a conference speaker. “Kevin is the man who advises Bush on financial services matters. Whenever we can get an audience and have someone with White House financial services, it elevates our position,” said Canning. Capital issues will also be discussed at the ACCU meeting with former NCUA chairman Dennis Dollar addressing the topic. Canning said corporates want to return to their days of a risk-based capital system and have capital standards more in line with other financial institutions. Dollar thinks corporates are overdue for risk-based capital. “They are well managed and well capitalized and the nature of their balance sheet is low risk. There are those who would look at their level of capital and natural person credit unions and think corporates are not as well capitalized. But because of the low risk nature of what they do and their capital supplemented with Paid-in-Capital and Member Capital Shares, their capital is very strong,” said Dollar. Another hot button topic is some new FASB (Financial Accounting Standards Board) rules that have corporates hot under the collar. “FASB thinks in certain circumstances you should have to record changes in the market value of securities available for sale through your income statement. It would have the unintended consequence of forcing financials such as corporates to classify our securities as held to maturity, which could impact the ability to use them as liquidity. That’s particularly important to corporate credit unions,” said Kenealy. “I’m not sure they are practical in the application of accounting. They’ve become so esoteric and analytical, they’re losing grasp of the purpose of accounting, which is to fairly represent the operating results of an ongoing concern,” said Kenealy. The ACCU plans to submit a comment letter to FASB on the proposal. On the housekeeping side, ACCU is expected to maintain its budget at $600,000. The budget is funded by corporates who pay $11 per $1,000 of assets. The most any one corporate can pay in dues is $45,000. Small corporates must pay at least $3,000 in dues. One of the big ticket budget items that will be up for a vote is Callahan’s Peer-to-Peer service which costs ACCU about $40,000. Canning noted that this is an aggregate price and cheaper than the total if each individual corporate bought the service on their own. Of the ACCU’s $600,000 budget, $350,000 is given to CUNA as part of a management agreement CUNA has with ACCU. The CUNA money pays for Canning’s salary and ACCU Program Coordinator Joshua Jones’ salary. Canning and Jones also work out of CUNA facilities and are able to utilize CUNA resources. Kenealy is expected to be named chairman for another one-year term. This would be his second term. [email protected]

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