By Frank J. Diekmann
Just in time for Independence Day, credit union members have been given more rights in their respective democracies. Too bad so many who came before them didn’t have the same rights and weren’t able to make informed votes.
As CUToday.info reported here, the NCUA approved a final rule on voluntary mergers designed to provide greater transparency to members and the public on the deal that is being struck and the compensation provided to top executives of the acquired CU.
The new rule comes after CUToday.info has reported earlier on just how much undisclosed compensation has gone to and goes to the management and volunteers of credit unions in some mergers, where the capital that belongs to everyone suddenly goes to a few in management—and the board—to entice them to agree to merging into another CU.
Key changes in the new rule are that members must be given notice of the merger and provided with information at least 45 days in dance of the vote, as opposed to the current seven-day minimum notice. Merger-related compensation paid to the top five executives of the acquired CU that exceeds $10,000 or 15% (whichever is greater) of current compensation must be disclosed. NCUA, too, will host a moderated web page for member-to-member merger communication. The new rule also clarifies the contents and format of the members’ notice to provide better information, NCUA said.
While state regulators didn’t like it, the NCUA board is to be applauded for applying the rule to all federally insured credit unions. Those members have as much a right to know what’s going on with their money and credit union as do members of fed charters.
“Some of these (management) people should receive some sort of bonus or other compensation. I know that happens all the time,” said NCUA Chairman J. Mark McWatters at the board meeting last week. “But the best answer is to disclose the story, not make it secret or pretend it does not exist…I don’t think this will have a chilling effect on mergers. If it does, perhaps there was something wrong with the merger in the first place.”
I wish I had said that myself. And in a few years, I intend to take credit for it.
In the meantime, Happy Independence Day to credit union members across the US of A.
And now, lacking any segue, some random notes from the road:
Advice on Hiding Your Goat
Speaking to the CUNA HR, Training and Organizational Development Council recently, Steve Guilliland observed, “People say there are two sides of every story. But there are four: The way I see it, the way you see it, the way it really is, and the way the media reports it.”
Later, Guilliland also offered these observations:
- “I’m not OCD. I’m CDO. I put it in alphabetical order.”
- “Have you ever had someone try to get your goat? That one member who says you’re the reason there is no money in their checking account. People get your goat because people find your goat. So hide your goat.”
- “I assign values to everything. You have to understand that in life abundance is result of appreciation, not accumulation.”
I Think That I Shall Never See, Anyone So Scrawny as Little Old Thee
Shawn Rhodes, who also recently spoke to the CUNA HR Council, shared leadership lessons drawn from his career in the Marine Corps. And he recalled the taste of the Marines he received before he ever arrived at boot camp, noting that when he walked into a recruiting office he was greeted with, “Boy, did you get lost on your way to a poetry reading?”
Until Password Do Us Part
John Best of Best Innovation Group (BIG) shared this story of the call he received from one member while he was doing some work at a credit union. The man who called was extremely frustrated that his user name and password—which he knew to be correct—would not allow him access to the credit union’s online banking solution. He repeatedly received a message that he was locked out.
Best said he checked the UN and PW and found the man was right, they were both correct. After some sleuthing, what was finally discovered was the man’s ex-wife—who knew both pieces of information—would frequently log in with the right user name and then enter an incorrect password in order to lock him out of the system. She was also especially fond of logging in on Friday afternoons so her ex would lack access all weekend.
The man was instructed to change his user name and password.
Why Marketing Needs to Change
Separately, Best also offered this insightful observation: “Marketing is something we have to change. It has to evolve. Brand is a whole different thing in today’s world. When you become an advisor to people, when people trust you, that’s when you get their business. One thing I can tell you is Millennials will not accept a cryptic process. You need a video with some sock puppets and it needs to be funny and it can’t be more than three minutes. We have an opportunity, a mandate, a mission, as credit unions to educate our membership about finances. That’s what this is about. If we can be the answer to the questions, they will come to us. Right now it’s Rocket Mortgage that is doing a good job of answering these questions.”
Best added that any user who is on the Rocket Mortgage site who then falls off for any reason receives a phone call from the lender.
Frank J. Diekmann is Cooperator in Chief at CUToday.info and can be reached at Frank@CUToday.info or @FrankCUToday.