Moldovan Regulators Study Wisconsin CUs

MADISON, Wis. — When Ron Kase joined the staff of Landmark Credit Union, now headquartered in New Berlin, Wis., in 1973, assets were US$2 million, and members were served by five employees, one of whom had been hired in the 1940s. Today as Kase prepares to retire his post as Landmark’s president and CEO, the credit union — now Wisconsin’s largest — boasts US$1.6 billion in assets and serves 117,000 members from 19 offices.

The secret, Kase told a visiting group of four financial regulators from the former Soviet satellite country of Moldova, was adhering to philosophy and maintaining consistency. Credit unions grow best when they can mobilize savings for both institutional strengthening and member service, characteristics that contributed greatly to Landmark’s growth.

The Moldovans’ visit to Landmark was the capstone to a week of credit union education sponsored by World Council of Credit Unions (WOCCU). The visiting regulators sought to better understand how successful credit unions operate so their country’s own fledgling industry would be better poised to meet operational standards when the country applies to join the European Union later this year.

“We know that savings-led development coupled with appropriate and enabling regulations are key ingredients for credit union growth,” said Dave Grace, WOCCU senior vice president of association services who co-hosted the visitors with Liliana Tangwall, WOCCU credit union analyst and a Moldova native. “Wisconsin’s credit union movement and its regulators did a fantastic job demonstrating the success of these principles.”

Adhering to higher standards will be especially critical for Moldova’s credit unions, which serve about the same number of members as Landmark credit union alone. The European Union requires deposit-taking financial institutions in all its member countries to insure each deposit for up €100,000 (approximately US$135,000), a sizeable investment for Moldova’s small financial cooperatives and just one of the challenges they face.

Landmark was only one stop for the representatives from the National Commission of Financial Market (NCFM), Moldova’s financial regulatory body. The group also visited with Madison Credit Union and Dane County Credit Union, both in Madison, as well as the Wisconsin Credit Union League, Credit Union National Association and even the Wisconsin Department of Financial Institutions’ Office of Credit Unions. A webinar conducted from WOCCU’s Madison headquarters with members of the European Network of Credit Unions, WOCCU’s sub-organization of European Union members, provided a European context for what the regulators had learned.

In addition to savings mobilization, the delegation learned about risk-based supervision, deposit insurance and the importance of sharing best practices among credit unions, their trade association and their regulator, according to Elena Pui, a board member of NCFM.

“Considering that Moldova’s system is passing through an emerging consolidation to increase its credibility, information on insurance for shares and loan loss was especially important,” Pui said. “It was very helpful to hear them discussed from many different points of view.”

Joining Pui on the delegation were NCFM credit union and microfinance department staff members Alina Dima, Alina Cataraga and Tatiana Balin. The delegation agreed to maintain an ongoing dialogue with WOCCU while it pursues European Union membership.

“The training program gave us exposure to best practices that we know will be put to good use,” Pui said. “We’re very grateful to have had the opportunity.”

World Council of Credit Unions (WOCCU) is the global trade association and development agency for credit unions. WOCCU promotes the sustainable development of credit unions and other financial cooperatives around the world to empower people through access to high quality and affordable financial services. WOCCU advocates on behalf of the global credit union system before international organizations and works with national governments to improve legislation and regulation. Its technical assistance programs introduce new tools and technologies to strengthen credit unions’ financial performance and increase their outreach.

Worldwide, 49,000 credit unions in 97 countries serve 184 million people. In 2009, WOCCU’s technical assistance programs reached 5.9 million people in 16 countries. Learn more about WOCCU’s impact around the world at www.woccu.org.

 

Contact: Mike Muckian
Organization: World Council of Credit Unions
E-mail: mmuckian@woccu.org
Phone: +1-608-395-2080

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