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Credit Union Times

NOVEMBER 22, 2017 | VOL. 28 | NO. 41 | CUTIMES.COM

The Next
Disaster Is
Coming
PETER STROZNIAK

pstrozniak@cutimes.com

hether you believe that climate change or some other natural phenomenon is increasing the frequency and intensity of natural disasters, it didn’t really matter for credit unions, employees, members and their communities in Texas, Florida, Puerto Rico, the Virgin Islands and California that suffered under nature’s fury.

From August to October, four major natural disasters, Tropical Storm Harvey in southeast Texas, Hurricane Irma in the Virgin Islands and Florida, Hurricane Maria in Puerto Rico and the California wildfires, left behind a devastating path of destruction that shut down and damaged credit unions, or destroyed the homes of credit union executives, employees and members.

What matters now are the ongoing recovery efforts and reflections of lessons learned that could help credit union executives prepare for the next inevitable natural disaster that may be headed their way.

Michael McKinley, senior claims manager for CUNA Mutual Group in Madison, Wis., leads the organization’s customer disaster response team. The team members and/or partners

OPERATIONS

Y18

CYBERSECURITY

Websites Battle Bots Heading into Black Friday, Cyber Monday and this holiday season, the biggest security threat may come from bots designed to steal credentials, overwhelm e-commerce sites and siphon funds from gift cards.

To better understand the threat, the San Francisco-based bot detection and mitigation company Distil Networks analyzed 2016 holiday traffic to approximately 600 e-commerce sites as well as a sample of 2,600 non-e-commerce sites over a six-day period.

Distil found bots – automated programs or scripts programmed to perform very specific tasks at the request of their architect – most likely deployed for one or more reasons over last year’s holiday season, performing various tasks, such as:

1. Scraping sale prices so competitors can match deals in near real-time.

2. Flooding a competitor’s site with more requests than it can handle (denial of service) to affect their sales.

3. Skewing analytics to impact conversion rates or performance metrics.

4. Clicking on ads to drive up digital ad spend costs.

5. Obtaining limited-availabil-ity or temporarily-lowered goods to resell at a higher cost later.

6.Populating forums (likely the customer review section of the site) with ads for Y16

Must Reads FOCUSREPORT:
NONINTEREST
INCOME

Growing noninterest income remains a priority for credit unions, but the way they’re achieving that growth is changing. In this Focus Report, learn five new strategies for reaching traditional noninterest income goals. Y6

he nation’s 10 largest credit unions fared well last summer, generating $638 million in net income during the three months that ended Sept. 30, up 23.1% from 2016’s third quarter despite higher loan loss provisions.

The NCUA quarterly statements
for the credit unions with the larg-
est total assets reflected the slow-
down in mortgage lending and
increase in car lending seen in
earlier reports.

The analysis by CU Times also showed a major gain in net interest income, despite loan loss provisions of $478.5 million for the three months ending Sept. 30, 24.2% higher than in 2016’s third quarter. For the nine months, income was reduced by $1.3 billion in loan loss provisions, up 26% from a year ago.

The composition and ranking
of the Top 10 was unchanged from
June. At No. 1 was Navy Federal
Credit Union, Vienna, Va. ($83.7
billion in assets, 7. 4 million mem-
bers). At No. 10 was Star One CU,
San Jose, Calif. ($9.5 billion in as-
sets, 101,004 members).
The Top 10 had 15. 8 million
members at the end of the third
quarter, up 9% from a year ear-
lier. The gains ranged from Pen-
tagon Federal Credit Union’s 11%
gain to 1.6 million members to
Security Service Federal
MANAGEMENT