International

ANNUAL REPORT

World Council of Credit UnionsVictor Miguel CorroVice President, Worldwide Foundation for Credit Unions International Partnerships Program

Joshua FettingInternational Partnerships Officer

Partnerships Program

2010: January–December

Executive Summary

In 2011, World Council of Credit Unions added one new partnership to its existing International Partnership Program. In June, the Romanian credit union

federation, FEDCAR established a formal relationship with the Ohio Credit Union League. The new partnership will focus on supporting and strengthening the Romanian federation.

The balance of 2011 was spent engaging as many partnerships in as many activities as possible, as well as identifying those partnerships that had completed their lifecycles and moved into a dormant phase. In 2012, the program will turn its focus to signing new partnerships by engaging new credit unions and organizations that had never before participated in the program, while at the same time reengaging those organizations involved in the past. The partnerships program maintained its strong level of support, with 19 partnerships having at least one partner providing direct financial support to the program. There are a total of 37 financial supporters in the program.

Partnership activities and other events sponsored by the partnerships program received more than their share of media coverage. (See attached.) Articles and stories on international partners and departmental programs often appear in league newsletters, CUNA’s News Now, Credit Union Magazine, Credit Union Times and, periodically, in non-U.S. financial and trade publications. The program’s efforts resulted in 18 news releases issued in 2011. Fourteen of those releases pertained to the international partnerships program and four others pertained to study tours.

In 2011, we continued finding success with World Council’s Customized International Training. World Council hosted a record 14 international study programs throughout the U.S., Canada and the United Kingdom, serving 182 participants.

The partnerships program last year also engaged a total of five U.S. credit union and league volunteers in training events in Belize, El Salvador, Russia and Fiji.

One of our most significant achievements last year was receiving a U.S. State Department grant from the Bureau of Educational and Cultural Affairs to carry out the Young Entrepreneurs Exchange Program in 2012 and 2013. The program falls under the State Department’s Professional Fellows Program which gives industry employees and volunteers from foreign countries opportunities to participate in an internship in the U.S. The program also has a second component which allows their U.S. counterparts to participate in a program in the selected foreign country. The project awarded to the Worldwide Foundation for Credit Unions in 2012 and 2013 will work with Guatemala and the Dominican Republic.

2011 PARTNERSHIP ACTIVITIES

Total number of partnerships

22

New partnerships signed in 2011

1

Number of active partnerships in 2011

17

Total partnership activities 19

Number of WOCCU supporters involved in partnerships program

37

Total press coverage of partnership activities

14

STUDY TOURS & TRAINING EVENTS

Total number of programs 14

Total participants 182

In 2011, WOCCU’s International Partnerships Program serviced 22 different partnerships:

The following thumbnail reports outline what was achieved within each partnership.

SIGNED PARTNERSHIPS

1. Bahamas / Massachusetts

2. Belize / Catalyst Corporate Credit Union

3. Brazil / Texas

4. Costa Rica / League of Southeastern Credit Unions

5. Dominican Republic / Wisconsin

6. Estonia / Virginia

7. Ghana / Jefferson Financial CU

8. Guatemala / California & Nevada

9. Jamaica / Texas

10. Mexico Alianza / New Mexico

11. Mexico Caja Yanga / Servus Credit Union

12. Panama / Iowa

13. Paraguay / Minnesota

14. Peru / Vermont

15. Poland / Georgia (direct relationship)

16. Puerto Rico / New York

17. Romania/Ohio

18. Russia / Louisiana

19. Solomon Islands / Idaho

20. Suriname / North Carolina

21. Trinidad & Tobago / Connecticut

22. United Kingdom / Washington, D.C. & Maryland (direct relationship)

The Bahamas Co-operative League & the Massachusetts Credit Union League

The Belize Credit Union League & Southwest Corporate Federal Credit Union

Brazil SICREDI & Texas Credit Union League

Rob Kimmett, senior vice president of marketing and public relations for the Massachusetts Credit Union

League, visited the Bahamas in early November to meet with the Bahamas Cooperative League and its member institutions. Kimmett joined Stephanie Missick-Jones, the Bahamas League general manager, for visits to Bahamas Island Resort and Casino Cooperative Credit Union, Teachers and Salaried Workers Cooperative Credit Union and Public Workers Cooperative Credit Union, all located in Nassau.

Kimmett also participated in a Bahamas Cooperative League training session at the Wyndham Hotel in Nassau. The event was attended by 27 volunteers and professionals from seven credit unions, the league and the Bahamas’ Department of Cooperative Development. At the session, Kimmett facilitated a workshop entitled “Building Marketing Strategies” that incorporated theory, emerging trends and best practices.

Brian Turner, director of advisory services for Catalyst Corporate Federal Credit Union, with locations in Texas

and Georgia, travelled to Belize City, Belize, to facilitate an educational session at the Belize Credit Union League Annual Convention and Banquet. Turner focused on “Financial Management of Credit Unions” in a presentation

In September, nine credit union managers representing the Brazilian credit union system SICREDI participated

in a credit union internship program through the organization’s partnership with the Texas Credit Union League. The nine participants started their program in San Antonio, Texas, attending the Texas League’s Leadership Conference. From there, they split into two groups, one traveling to Austin and the other to Houston. Over the next two weeks, participants engaged in work-study programs

designed for both credit union board members and managers. Turner touched on the key financial risk areas for credit unions and reviewed the responsibilities of board members for successful financial management of a credit union.

with two or three different credit unions. The Brazilian participants learned about every area of credit union operations and spent time with staff to become familiar with both theory and real-world applications related to each credit union position. This program has become an annual engagement between credit unions from Brazil and Texas, focusing primarily on the needs of young credit union managers.

Costa Rica FEDEAC & League of Southeastern Credit Unions

Dominican Republic AIRAC & Wisconsin Credit Union League

A delegation of 14 Costa Rican credit union representatives spent a week in Birmingham, Ala.,

with four of the most unique area credit unions in October. The 14 representatives first met with the League of Southeastern Credit Unions to receive an orientation on the U.S. credit union system and an introduction to the role the league plays in Alabama and Florida. At the league’s offices, the delegation also met with Brad Green, CEO of Listerhill Employee’s Federal Credit Union in Sheffield, Ala., whose credit union is known for their unique youth outreach programs.

In October, executives from the Wisconsin Credit Union League and a member credit union led a governmental

affairs training program for 13 credit unions in Santo Domingo, Dominican Republic. The one-day workshop attracted 35 attendees representing 13 of AIRAC’s 15 member credit unions. German Robles, assistant director of IDECOOP, the Dominican Republic’s financial regulator, opened the workshop with his remarks. Presenters included the Wisconsin League’s Brett Thompson, president and CEO, and Tom Liebe, vice-president of governmental affairs, and Patricia Wesenberg, president and CEO of Central City Credit Union in Marshfield, Wis.

The Brazilian delegation also visited four area credit unions: America’s First Federal Credit Union, eCO Credit Union, Alabama TelCo Credit Union and Mutual Savings Credit Union, all in Birmingham. The group focused on branch management and service delivery in its discussions with credit union representatives. Marketing was also a common theme of the meetings. The group viewed America’s First FCU’s “Banker Confessions” campaign of TV spots targeting high fees charged by banks.

Each presenter urged workshop attendees to establish an advocacy position based on the benefits credit unions provide their members and to speak together as a movement and in a united voice when addressing government officials.

In addition to the workshop, the delegation traveled to Las Matas de Farfán to visit COOPCENTRAL, a credit union serving the local agricultural community. The group also visited two farms growing aji peppers and other crops in operations funded by credit union loans.

The year 2011 was a busy and very productive year for the Virginia Credit Union League (VACUL) and

the Estonian Union of Credit Cooperatives (EUCC) partnership. The EUCC has added new members in anticipation of bringing to fruition the live online functions of Baltic Shared Services (BSS), core banking solution jointly created by VACUL and Estonian firm Mindware. In March 2011, meetings were held to finalize BSS as a functioning company and to begin offering direct clearing and internet banking to EUCC members. This effort will take the credit cooperatives (CC) into the next phase of their development.

One of the highlights of 2011 was the attendance of delegations from Estonia, Latvia and Lithuania and the U.S. credit union movement at the landmark Crossroads Symposium held at the University of Virginia. All three delegations from the Baltic States made presentations to symposium participants and provided written reports from the presentations that were included in a final symposium

Mark Rosa, president and CEO of Jefferson Financial Credit Union in Metairie, La., visited GESRO Credit

Union in Takoradi, Ghana, as a follow up to 2010’s visit by Kusi Boachie, GESRO’s CEO, to Louisiana. Rosa used the opportunity to become familiar with GESRO’s operations and market and in turn, offered insight into possible

report. Participation in the symposium by the three nations marked a milestone of progress toward cooperation and collaboration among credit cooperatives in the Baltic States.

The Crossroads Symposium and the continued progress of BSS succeeded in establishing a framework for future success in Estonia, Latvia and Lithuania. The “live” operation of BSS in 2012 will represent the culmination of five years of joints efforts by VACUL and the EUCC to establish a solid footing for the future.

Further meetings were held in Estonia in October 2011 to finalize the BSS business plan, funding and target dates for completion in 2012 and to celebrate International Credit Union Day. At that meeting, the partners affirmed their mutual commitment to the future and EUCC agreed to proceed with the BSS effort, aiming to meet the 2012 target dates.

solutions to some of GESRO’s challenges. Rosa was also invited to speak to GESRO’s directors during its board meeting, during which Rosa fielded questions about car loans, telephone loan applications and data processing systems.

Estonian Union of Credit Cooperatives & Virginia Credit Union League (Report provided by Juri Valdov of Northwest FCU)

GESRO Credit Union (Ghana) & Jefferson Financial Credit Union (Louisiana, United States)

In June, five Guatemalan credit union representatives traveled to San Juan, Puerto Rico, and Ontario, Calif.,

to explore the possibility of implementing international shared branching in Guatemala. The visit, facilitated by FSCC, was organized to show how shared branching is implemented and utilized in a Spanish-speaking market. The group also visited two credit unions in Puerto Rico — Jesus Obrero Credit Union and Aibonito Credit Union — and Helvetia del Caribe, the main credit union software provider on the island.

The group then flew to Ontario to meet with FSCC at its main office to learn more about the technical requirements for implementing international shared branching. They also took the opportunity to meet with Diana Dykstra, the California & Nevada Credit Union Leagues’ new president and CEO, to learn about the role of the league and discuss future partnership activities.

In June, Caja Yanga sent three delegates to Edmonton, Alberta, to study the risk management and anti-money

laundering practices used by Servus Credit Union’s Enterprise Risk Management Program, as well as the Canadian credit union’s corporate security policies and procedures. Caja Yanga Chairman Manuel Hernandez, along with Abel Martinez, risk manager, and Gabriel Martinez, accounting and finance vice president, studied the operations of Servus’ corporate security team, which is responsible for all of the credit union’s anti-money laundering and anti-fraud efforts. Servus’ Mark Foote, corporate security compliance manager, and Ana Roccia, corporate security senior analyst, shared the credit union’s

In October, Oswaldo Oliva, CEO of MICOOPE/FENACOAC, was invited to speak at the California and Nevada Credit Union Leagues’ Annual Convention in San Diego. Oliva spoke about the rebranding of the FENACOAC credit unions, which now all use the name MICOOPE as a unified brand.

In November, Dykstra paid a reciprocal visit to Guatemala to learn about their credit union system. While there, Dykstra advocated for credit unions at the Central Bank and Superintendency of Banks. She also conducted two learning sessions with the Guatemalan credit union trade association, Federación Nacional de Cooperativas de Ahorro y Crédito (FENACOAC), and Guatemala credit union CEOs. Dykstra spoke about innovation in financial services, staff development and retention, risk management, cooperative principles, and how to stay relevant in a rapidly changing world.

strategies for detecting suspicious activities and identifying accounts representing a high risk for money laundering activity.

The group looked closely at Servus’ risk management program, which identifies eight main risk categories that pose a threat to the credit union. Ruth Kizlyk, Servus’ enterprise risk management director, explained the impact of each risk category and how each category is measured quantitatively. The quantitative analysis allows the risk management committees to decide how much risk the credit union can bear and how to mitigate that risk when it exceeds desired limits.

Guatemala FENACOAC/MICOOPE & California & Nevada Credit Union Leagues

Caja Popular de Ahorros Yanga (Mexico) & Servus Credit Union (Alberta, Canada)

Iowa Credit Union League executives and CEOs representing three member credit unions traveled to

Panama to help their partner institution, COFEP, address growth and development issues related to regulation and the development of a central finance facility. The Iowa representatives working alongside World Council hosted a day-long conference for more than 50 Panamanian credit union attendees. The conference facilitated the exchange of best practices and addressed challenges facing Panama’s credit unions. Presentation topics included collaboration, new business development ventures, innovative ways to generate loan interest and development

Mark D. Cummins, president/CEO of the Minnesota Credit Union Network (MnCUN); Dick Nesvold,

president/CEO of SouthPoint FCU, New Ulm, Minn.; and Jeff Schwalen, president/CEO of Hiway FCU, St. Paul; traveled to Asuncion, Paraguay, to meet with CENCOPAN and participate in CENCOPAN’s ninth annual international seminar, which coincided with the organization’s 17th anniversary. The event featured speakers from the U.S., Canada, Germany, Brazil and Ecuador, all of whom provided insight on topics pertinent to Paraguayan credit unions. Schwalen and Nesvold co-presented a session entitled “The History of Deposit Insurance in the U.S.,” and Cummins provided the trade association perspective during his “Building Non-dues Revenue” presentation. The Minnesota delegation also visited four credit unions that serve as multi-purpose cooperatives.

In addition to the visit to Paraguay, Minnesota credit unions also hosted a six Paraguayan credit union delegates. The exchange highlighted the Minnesota credit unions’ advocacy activities and focused on industry issues, such as use of social media, branch design, policies and procedures, and uses of technology. The Paraguayan visitors also learned about MnCUN’s structure, activities and service to credit unions. The delegation also received an overview of governmental

of a central finance facility to manage system-wide liquidity. The conference wrapped up with a panel of Iowa credit union CEOs discussing best practices from their institutions.

During the visit, Iowa executives also participated in a meeting with the Panamanian credit union regulator. Ana Giselle Rosas de Vallarino, executive director of Panamanian Autonomous Cooperative Institute (IPACOOP), met with the Iowa delegation, World Council and COFEP to discuss the need for a cooperative central finance facility among Panamanian credit unions.

affairs, education, compliance and communications.

The group met with Minnesota’s Speaker of the House Kurt Zellers (R-Maple Grove), who discussed the relationship between lobbyists and legislators and the importance of meeting with constituents and representatives from various industries. Minnesota Gov. Mark Dayton provided a written greeting, thanking the visitors for their “dedication to the credit unions of Paraguay and commitment to the credit union philosophy of people helping people.” The delegation also met with Minnesota Department of Commerce Deputy Commissioner of Administration Steve Carlson and Credit Union Program Director Carl Schwartz, who discussed the coordination and cooperation between the credit union regulatory and oversight organizations and provided insight into the proactive nature of U.S. regulators and the standard monitoring mechanisms used.

Credit unions visited by the group included Hiway FCU and St. Paul FCU in St. Paul; SouthPoint FCU; and SPIRE FCU, Falcon Heights. The credit unions highlighted their approach to meeting members’ needs and made presentations on information technology infrastructure and security, internet banking, branch management, collections processes and business continuity.

Panama COFEP & Iowa Credit Union League

Paraguay CENCOPAN & Minnesota Credit Union Network

Poland’s NACSCU & Georgia Credit Union Affiliates(Direct partnership, report provided by Dan Denning, Partnership Liaison of GCUA)

The partnership between FENACREP and the Association of Vermont Credit Unions (AVCU)

included two activities in 2011. The first activity marked the beginning of a new credit union-to-credit union partnership between Peru’s Pacifico Credit Union and Vermont’s NorthCountry Federal Credit Union. Armando Ouchida, Pacifico’s CEO, traveled to Burlington, Vt., to sign the partnership agreement and meet with NorthCountry President and CEO John Benoit and other key NorthCountry staff to learn about the credit union’s lending, finance, technology, operations and marketing departments.

In May, a new partnership was signed between Gwinnett Federal Credit Union in Lawrenceville, Ga., and SKOK

St. Brother Albert Credit Union in Szczytno, Poland. Marshall Boutwell, Gwinnett’s president/CEO, and Szczepan Olbrys from St. Brother Albert signed the formal partnership agreement in Gwinnet’s main office. The Poland delegation’s remaining visit to Georgia included an executive overview and meeting with Gwinnett’s board and branch management and staff, interaction with local civic leaders and attendance at the Georgia Credit Union Affiliates’ annual convention. The visit concluded with a trip to Washington, D.C., for meetings with elected officials.

Another successful May visit took place between Delta Community Credit Union in Atlanta and Poland’s Jawarzno Credit Union. The Jarwarzno delegation included Agnieszka Maj, assistant sales director; Gabriela Mlostek, collections manager; Dominik Kowalczyk, IT manager; Bogdan Bis, a board member; and Grzegorz Tepling, sales manager and translator. Meetings with staff focused on Delta’s organizational structure. The group also visited the Georgia state capitol building and interacted with representatives of the governor’s office. The visit concluded with a trip to Washington, D.C., to tour CUNA’s offices.

In June, Dan Denning, vice president of knowledge development for Georgia Credit Union Affiliates (GCUA)

In the second activity, 12 representatives from NorthCountry FCU, Vermont FCU, also in Burlington, and AVCU traveled to Lima, Peru. The credit union representatives met with their respective credit union-to-credit union partners and FENACREP, the Peruvian credit union trade association. AVCU continued advising FENACREP in the areas of advocacy, the creation of a deposit insurance fund and the development of an ATM network. The Vermont group also visited Peru’s Congress, where they met with the chair of the Committee on Production, Micro and Small Business and Cooperative Banks.

and chief liaison for the Georgia/Poland partnership, traveled to Poland to attend the 19th annual general meeting of the National Association of Cooperative and Savings Credit Unions (NACSCU), Poland’s credit union trade association, in Wrocław. The 2011 event was scaled down from previous years in anticipation of hosting the 2012 World Credit Union Conference in Gdańsk, which will coincide with NACSCU’s 20th anniversary. This year’s meeting included a plenary session featuring Polish government officials, academic and educational presentations and awards ceremonies. Key issues discussed included business opportunities for credit unions, efforts to serve Polish society’s underserved, and legal challenges from a competition that threatens the Polish credit union system’s ability to grow.

In June, Mike Mercer, GCUA’s president and CEO, participated in a two-part World Council engagement program visit to Rabobank in Amsterdam and NACSCU in Sopot, Poland. During the program, Mercer accompanied Grzegorz Bierecki, NACSCU’s president and CEO, on the political campaign trail as Bierecki ran for and eventually won a seat in Poland’s senate. Mercer also met with representatives of TF SKOK to discuss various products and services, including TF SKOK’s ATM network, card processing and e-commerce programs.

Peru FENACREP & Association of Vermont Credit Unions

Russia Credit Union League & Louisiana Credit Union League

Ohio Credit Union League’s Paul Mercer, president, and John Florian, vice president of governmental affairs,

along with Bill Herring, president and CEO of Cincinnati Central Credit Union, traveled to Romania to formalize a partnership between the Ohio League and FEDCAR. World Council’s Brian Branch, president/CEO, and Victor Miguel Corro, vice president of the Worldwide Foundation for Credit Unions, also were part of the traveling delegation.

The group identified three areas of immediate need in which OCUL could help FEDCAR:

1. Support lobbying efforts to improve Romania’s credit union legislation;

2. Assist marketing efforts to bring more credit unions into FEDCAR’s membership; and

Eric Richard, EVP and general counsel of CUNA, and Rod Taylor, president and CEO of Barksdale Federal

Credit Union, Bossier City, La., attended the Russia Credit Union League’s fifth Credit Union Forum in May. The forum, held in Sochi, Russia, attracted credit union leaders from Russia and its neighboring countries. The forum focused on the importance of credit union legislation and supporting the national and regional federations and associations. Richard served on a panel discussing credit union regulations and Taylor on a member service panel.

3. Provide continued training in risk management, including a possible visit to Ohio by Romanian credit union leaders for intensive training.

In addition to signing the partnership agreement, the Ohioans met with leaders of two credit unions and observed common characteristics among FEDCAR credit unions: high delinquencies, high liquidity, increased costs and low loan volume. Mercer, Florian and Herring ended the visit by conducting a training session on risk management, advocacy, and the value of trade association membership for 64 leaders from all 17 FEDCAR-affiliated credit unions.

In November, 14 Russian credit union delegates traveled to Louisiana to meet with Barksdale Federal Credit Union and the Louisiana Credit Union League. The group first traveled to Shreveport, where members met with Barksdale FCU’s board of directors and staff to learn about their products and services. From Shreveport, the group traveled to New Orleans to meet with Louisiana League representatives. At the league offices, the delegates received presentations from executive staff on how the league serves its member credit unions and the importance of a league structure for credit unions.

Romania FEDCAR & Ohio Credit Union League

The Credit Union Association of New York (CUANY) offered a Compliance & Legal Conference for Puerto

Rican and U.S. Virgin Island credit unions in San Juan, Puerto Rico, on Nov. 29, attracting more than 30 attendees. Michael Lanotte, CUANY general counsel and SVP of association services, and Michael Carter, CUANY director of compliance, led the conference.

During the conference, Lanotte provided an update on debit interchange and the Consumer Financial Protection Bureau and discussed proposed regulations. Carter offered an update on recently passed regulations. They also engaged attendees in a compliance workshop during which they posed several scenarios, worked through potential issues and came up with solutions as a group.

Puerto Rico & Credit Union Association of New York

In March, Thomasa Holley and Peter Yeskey ,two board members of Members Credit Union, and Kathy Chartier,

president and CEO of Member Credit Union, both in Stamford, Conn., traveled to Trinidad and Tobago to visit and partner with Neal & Massy North Credit Union. The parties held a signing ceremony attended by the Co-operative Credit Union League of Trinidad and Tobago and representatives from a number of other credit unions. This marked the fourth credit union-to-credit union partnership between credit unions in Connecticut and Trinidad and Tobago.

In May, Carol Bayreuther, president/CEO of Hartford Healthcare Federal Credit Union, Keith Weimert, president/CEO of Seasons Federal Credit Union, Middletown, and Chartier attended the Co-operative Credit Union League of Trinidad and Tobago’s Leadership Conference. Chartier

presented on the history of the partnership from 2001 to present, generating interest from the attendees. In addition to the leadership conference, two staff members of Seasons FCU attended and presented at COPOS Credit Union’s annual planning session in Port of Spain, Trinidad and Tobago.

Finally, the partnerships committee of the Credit Union League of Connecticut purchased a guide created by Connecticut Credit Unions demonstrating the model for successful financial reality fairs for high school students. The guide was presented to partner credit unions in Trinidad and Tobago where COPOS Credit Union is spearheading the creation of a financial reality fair for Port of Spain students in cooperation with the other partner credit unions.

Co-operative Credit Union League of Trinidad & Tobago & Credit Union League of Connecticut

(Direct partnership, report provided by Kathy Chartier, CEO of Members CU)