Executive Summary International 4/30/2008

By Christian Mullins

Australia:

Moody’s Investors Service released a report stating they have rated the credit union sector ‘negative’.  The global financial crisis is mostly to blame, and an increase in the rate of mergers and acquisitions is expected.  Currently, there are 144 credit unions in Australia.

Austral Credit Union has announced their intention to merge into Adelaide based Savings & Loans CU.  The 15,000 member credit union will add CU 4 branches, 6 agencies, and 14 ATMs to S&L CU, but more importantly will help them increase their presence in the Melbourne market.  David Edwards, CEO of Austral CU, will not hold a position at Savings & Loans.

Canada:

Insurance brokers across several provinces in Canada are upset because they believe credit unions are subverting the laws governing the sale of insurance products on a technicality.  While banks cannot sell insurance products inside their branches, some credit unions are, using the guise that their insurance offerings are ’separate and distinct’ from their branch operations. (Editors note: This article was published on an insurance industry website)

While many credit unions tout the need for diversity amongst employees, Conexus CU in Saskatchewan has taken a novel approach when it comes to the hiring process.  Hiring one aboriginal at a time led to their perceived isolation, and many employees quit after a short time, so the CU began to hire groups of native employees 10 at a time.  Five years later, they have about a 50% retention rate of those hired from the Piapot Reserve.

Ireland:

After a disastrous attempt to modernize their electronic services in 2001, Irish Credit Union’s are ready to make another run at it.  Only about 10% of credit unions offer ATM cards, and they can only be used at their own machines; there are no regional or national ATM networks.  The proposed system will allow for electronic fund transfers, as well as ATM and Debit cards, with timetables to release in the coming months.

The Irish credit union movement celebrated their 50th anniversary last Friday in Limerick.  The country boasts 521 credit unions, 2.9 million members (Island population 6 million), and 13.4b Euro in assets.  The movement’s founding in 1958 was credited to the efforts of a teacher, a civil servant, and an employee of Peter Kennedy Bakers, all in Dublin.

Ireland remains a prime target for data theft, following the refusal of many financial institutions, corporations, and government agencies to sign an international security standard.  Last month, citizens were shocked to learn that four laptops belonging to Bank of Ireland and containing 10,000 customers personal information were stolen.  Only one financial institution, a credit union in Waterford, is fully compliant with data security regulations at this time.