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Credit Union Times
MAY 23, 2018 | VOL. 29 | NO. 18 | CUTIMES.COM
FOCUSREPORT:
As the U.S. population grows more and more diverse, the
average credit union board’s demographics remain largely
unchanged. Learn what’s keeping credit unions from
recruiting diverse, young board members and how some
are overcoming the challenges in this Focus Report. Y6
GOVERNANCE
& VOLUNTEERS
Governance
and Risk
What’s the board’s
ALCO role? Y10
Board
Challenges
Grow along with
industry
changes. Y8
HUMAN RESOURCES
Benefits Strategy: Opting Out
As a result of the strong economy
and the Tax Cuts and Jobs Act of
2017, many employers are considering ways to enhance their
benefits packages. Some employers have already increased employer contributions toward their
health plans and others have increased their 401(k) matching
contributions. Another potential
option for employers is to add an
opt-out payment for those who
waive health coverage.
Opt-out payments refer to
payments that:
• Are available only if the employee declines or waives coverage under an employer-spon-sored health plan; and
• Cannot be used to pay for coverage under the employer-spon-sored health plan.
An example of such a payment
is where ABC Corp offers its full-time employees medical coverage
at a cost of $100 per month for individual coverage. It also offers a
$50 per month opt-out payment to
full-time employees who decline
or waive coverage under the ABC
Corp plan. Under this arrangement, employees can pay $100 per
month to take the coverage or receive $50 if they decline or waive.
Here are several important
considerations when determining if an opt-out payment is right
for your benefits strategy.
ACA Affordability
Considerations
The IRS generally requires that
cash opt-out payments Y14
CUs Ignite Commercial Loan Growth
any credit unions
seek to raise their
level of commercial loans. Two of
them, one in Ohio and the other
in Washington, used slightly different efficiencies to successfully raise their business lending
game.
The $4.2 billion, Beavercreek,
Ohio-based Wright-Patt Credit
Union, which has 356,000 mem-
bers and 31 branches, mostly in
the Dayton area, wanted to digi-
tize the commercial lending pro-
cess, and focus on growth and
serving business members.
WPCU raised its commercial
loan portfolio 156% year over year,
using a cloud solution combining the Wilmington, N.C.-based
nCino’s Bank Operating System
integrated with e-signatures from
the Chicago-based eSignLive by
VASCO.
“In the last two years, we have
increased our capacity of lending
per borrower from
$5 million to $15
million. We were
processing 30 to
40 loans a month.
For several months
running, we’ve
had 100 loans in
production in a
month,” Benjamin
Miller, commercial portfolio man-
ager for WPCU, said.
STRATEGY
ROY URRICO
rurrico@cutimes.com
Y16
Miller
New
Members
Ditch the
Branch
MANAGEMENT
TINA OREM
torem@cutimes.com
or many people, their
first in-person visit to
a credit union branch
is critical – it’s where
all the new membership forms
usually are, after all. But thanks
to smartphones and computers, fewer prospective members
may be willing to make the trek
to a branch just to join a credit
union. That’s raising questions
about whether credit unions
should invest more in digital-only
membership applications and
onboarding processes, and less
in traditional face-to-face, paper-based systems.
However, taking the new membership process digital can be
tricky. A recent study from Citi
found that mobile banking apps
are now one of the three most-used types of smartphone apps,
and a PwC study recently found
that 46% of consumers now do all
their banking digitally – almost
double the number in 2012 (27%).
A J.D. Power study found, however, that “digital-only” customers – those who use only online
or mobile channels for banking
– were the least satisfied group of
banking consumers.
Pleasing members has always
been tough work, but in Y17