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Credit Union Times

MA Y 8, 2019 | VOL. 30 | NO. 15 | CUTIMES.COM

Must Reads

INVESTMENTS

‘Pensionize’ 401(k)s and IRAs In a world of defined contributions, American workers have three challenges – inadequate savings, leakage (or loans/early withdrawals) tied to their retirement accounts and the need for retirement income. Plus, just half of all DC plans offer a way for investors to transform balances into periodic retirement income, with only one in five offering guaranteed lifetime payouts.

This situation prompted Steve Vernon of the Stanford Center on Longevity, Wade Pfau of The American College of Financial Services and researcher Joe Tomlinson to explore and devise solutions to “pensionize” retirement plans. Their work, first published last year and then updated this year, finds that only one-third of workers contact financial advisors, and most lack the necessary skills to convert savings into retirement income and typically have short planning horizons.

But research from the Stanford Center on Longevity (SCL) and Society of Actuaries (SOA) has found a “straightforward retirement strategy,” according to the three authors. “Choosing a specific solution that will help workers generate retirement income requires them to make informed tradeoffs between potentially competing goals,” they explained, such as “maximizing lifetime income; providing access to savings (liquidity); planning for bequests;

HUMAN RESOURCES

Integrating Health Care at CU “Integration” has become a buzzword in health care. It sounds good, but what does it really mean? Quite simply, integration in health care is all about connecting otherwise separate parts of the health care system to drive better outcomes, lowe costs and improve the customer experience. The evidence shows connected patient care, in which the patient’s whole health is considered, leads to the best health outcomes. To support and com plement this approach, insurance companies are designing innovative integrated health car benefits packages.

When medical, pharmacy, dental, vision and disability care are seamlessly connected and the full power of integrated data is unlocked – including member claims, population insights and employers’ health managemen programs – health care providers have access to a complete picture of employees’ health and well-being in a format that is easy for multiple providers to ccess and interpret. Instead of walling these services off in a silo, they are integrated into one system, allowing for the optimized collection and sharing of key, actionable information.

The information that integrated health care delivers helps pr viders see the broader picture, allow ng them to better prevent, diagnose and treat illness while also giving them the ability to identify minor issues Y16

Board Strategy Design a board that delivers value. Y14

Memorable

Marketing Conquer your online competition. Y10

FOCUSREPORT: DIGITAL MEDIA

To reach today’s members and prospective members, CUs must develop an omnichannel experience that is aligned with consumer media consumption. Learn more in this Focus Report. Y6

ven as credit unions try
to raise caps on member
business lending, they
are also running against
barriers related to the higher com-
plexity of business lending, and
the movement’s recent and un-
fortunate experience with a form
of commercial loan that soured
– loans backed by taxi medallions.
Credit unions increased their
business lending faster than
banks last year, but the movement
is just a drop in a banking ocean.
Credit unions held $65.6 billion
in commercial loans backed by
real estate at the end of 2018, up
16.5% from a year earlier. Com-
mercial loans not backed by real
estate rose 7% to $7.5 billion.

FDIC data showed banks held $2.16 trillion in commercial and industrial loans on Dec. 31, 2018, up 7.8% from a year earlier. Last year’s growth rate was nearly twice that of the 4% growth rate in 2017.

Banks also held $2.33 trillion in real estate-backed loans for business purposes, including construction and development, offices, stores, apartments and farmland. Growth of those busi-ness-related loans was 4.3% in 2018 and 5.6% in 2017.

Many credit unions have shied away from business lending Y18 JIM DUPLESSIS CU Business Lending Rises

GROWTH STRATEGIES

howing members the money, and closing and collecting loans, Temenos’ digital environment is helping credit unions achieve those goals by providing them a holistic member view from origination to distressed asset management.

Three credit unions – Maps Credit Union ($775 million, Salem, Ore.), Hudson Heritage Federal Credit Union ($403 million, Middletown, N.Y.) and Guardian Credit Union ($511 million, Montgomery, Ala.) – recently expanded their existing relationships with the Geneva, Switzer-land-based Temenos, which has its U.S. headquarters in Malvern, Pa., to include additional modules of the Temenos Lifecycle Management Suite.

The LMS, which, according to the financial technology company, is used by more 600 credit unions and banks, is comprised of software modules containing business-specific functionality designed to streamline operations in account and loan origination, service, collection and recovery. All modules are available individually or as a complete set of packaged products.