The credit union movement started in southern Germany in 1849. Farmers, workers, and trades people were being victimized by unscrupulous money lenders. In a concerted effort to lift themselves from poverty and finacially support one another, the laborers banded together and pooled their resources. Their effort proved to be successful, and so was born the credit union movement. In 1909, for many of the same reasons, the first credit union was founded in the United States of America at Manchester, New Hampshire.
The importance of the credit union movement came to be tested and proven during the Great Depression. Many people were finding it difficult to make financial ends meet. Even those with jobs were having trouble. Some had to borrow money at very high interest rates, while others could not even qualify for a loan.
On August 31, 1939, the Nebraska State, Employee's Co-operative Credit Association was granted a charter by the State of Nebraska. It was organized for the purpose of encouraging thrift and providing funds from which employee loans could be made at reasonable rates. This concept of "People Helping People" has continued and has expanded throughout the credit unoin's fifty year history.
The Credit Union is a non-profit institution which provides loans and a safe place to deposit savings. It is run by its members, for its members, with all members having at least one share. Earnings are returned to members in the form of better services, lower rates on loans, and higher returns on savings. It is regulated by the Nebraska Department of Banking and Finance, must comply with State laws, and undergoes regular annual audits by the State.
In 1939, there were three requirements for membership: (1) being a regular full-time employee; (2) puchasing one share of capital stock in the Association at a par value of $10.00; and (3) paying a membership fee of 25 cents. In the early days, the Directors of the Association contacted employees in their respective areas in order eo encourage membership participation. John E. Sidner (deceased) one of the original Charter signers and a strong supporter of the credit union, related stories of the frugal operation during the first years. Assets from which loans could be made were practically non-existent so when a loan application was received, Mr. Sidner personally went from member to member collecting enough cash to make the loan.
By the end of the first year, the Association had 54 members, Share Balance of $367.00, and no record of Dividend being declared the first year. During the next few years, memberships, shares and loans grew steadily as shown in chart below.
| DATE | NO. OF MEMBERS |
LOAN BALANCE |
SHARE BALANCE |
RATE OF DIVIDENDS |
|---|---|---|---|---|
| Dec. 31, 1939 | 54 | 242 | 367 | None |
| Dec. 31, 1940 | 55 | 588 | 738 | 6.0% |
| Dec. 31, 1941 | 58 | 1,151 | 972 | 3.6% |
| Dec. 31, 1942 | 51 | 959 | 1,056 | 2.5% |
| Dec. 31, 1943 | 45 | 942 | 1,307 | 3.0% |
| Dec. 31, 1944 | 46 | 921 | 1,621 | 3.5% |
| Dec. 31, 1949 | 120 | 11,118 | 17,045 | 3.5% |
| Dec. 31, 1959 | 219 | 37,902 | 89,418 | 4.0% |
| Dec. 31, 1969 | 370 | 260,609 | 273,540 | 6.0% |
| Dec. 31, 1979 | 600 | 612,606 | 689,362 | 8.0% |
| Dec. 31, 1989 | 962 | 1,538,770 | 1,906,148 | 6.75% |
| Dec.31, 1999 | 972 | 2,262,287 | 3,208,901 | 4.0% |
Part of the stability and growth was due to the benefits that the Association offered its members. A member could deposit savings by paying for a share in whole or in part at time of subscription. He or she could borrow money for any worthy cause. Members who received loans were originally required to pledge their shares as security. Other security had to be taken for any loan in excess of $300.00. A member could receive a loan in fixed monthly installments instead of one sum.
No Director, Officer or member of the Credit or Supervisory Committee could borrow from the credit union while he or she held office, beyond the amount of his or her holdings in shares and accumulated dividends, or endorse for other borrowers.
The rate of interest to be charged on loans was established by the Board of Directors but originally could not exceed 12.0% per annum on unpaid balances. The current low interest rates are adjusted quarterly to meet market demand.
One unique feature of the credit union is that it returns the earnings to its members in the form of a dividend (interest). In 1953 this took on a different perspective in the form of a "Patronage Interest Refund," which was 10.0% of the interest paid on their loans during that year in addition to regular dividends paid on their shares. This P.I.R. was very popular and was repeated annually through 1978.
During World War II, the credit union experienced trying years. Many men and wormen were away in the armed services, consumer goods were severely ration or not available, and consequently the need to borrow was greatly reduced. As a result, the demand for loans and earnings experienced a sharp decline. After the war, as GI's began to return home from the service and more consumer goods were available, loan demand started to increase as well as earnings.
Information from the Annual Meeting of January 27, 1944, held at 4:10 p.m. indicated it would take $21.63 to pay a 3% dividend for the year. The treasurer then outlined some of the services of the credit union which included: Loan Insurance, Life Insurance, Automobile Insurance, and Share Insurance.
Because of increased business in the Omaha office, in 1948 it was necessary to appoint a representative in Omaha to handle the credit union's business and forward same to Lincoln for processing.
In 1949 a concerted effort was made to inform employees throughout the State of services available to them through credit union membership. At that time there were just a few members from 11 different offices statewide. The average loan balance that year was just under $200.00.
During 1954 shares increased by 31.0% and loans by 51.0%. The loan increase was encouraging since it would provide considerably more income.
Minutes of the Annual Meeting held on January 20, 1960 at King's (Restaurant), 1316 'N' Street, indicated a buffet dinner was served to members, families, and guests preceding the business meeting. Movie entertainment was shown in the Division's conference room during the business meeting. It was suggested By-Laws be changed to proved staggered terms for the supervisory committee rather than the current one-year term for the entire committee. This was adopted at the next Annual Meeting.
The 25th Annual Meeting was held at the Legion Club on January 22, 1964. There was a drawing for door prizes which were shares in the credit union. The President stated that in 25 years we have written off $253.00 as uncollectible (an average of only $10.12 per year). During the second 25 years of operation, a total of $31,414.00 has been written off as uncollectible.
At this meeting, a merger with Capitol Employees Credit Union was discussed. However, it was decided we would remain as originally established. During the election of officers there was a tie vote which was decided by a "flip of the coin." A 4.5% dividend was declared as well as a 20.0% P.I.R. At the end of the 25th year of operation, assets totalled $163,040.57, loans $111,712.61, and 280 members.
The 30th Annual Meeting was held on January 24, 1969, at El Ranch Club, Emerald, Nebraska, with 27 members present plus guests. Attendacne was encouraged by giving credit union shares as door prizes and by subsidizing the buffet dinner to members was $1.50. At this time the share capital exceeded a quarter of a million dollars for the first time.
As each year passed, new loan and share records were attained. Before its 30th year, the credit union reached heights its founders could not possibly have envisioned when the organization was founded. From meager and well-intentioned beginnings in 1939, the credit union reached a quarter of a million in assets during 1968; a half million in assets during 1975; with a record one million dollars in assets in 1982. The big milestone of 2 million dollars was reached in 1986 wiht 871 members. The year 1987 was a milestone for loans as they not only reached but exceeded one million dollars.
For almost 32 years the credit union was opperated by the elected Board and Committee members. These volunteers gave their time with no monetary compensation except for a small salary paid to the treasurer. As the credit union grew and also the volume of business being conducted, it became apparent an Office Manager was needed.
Effective June 2, 1971, Mrs. Anne Maly, was hired as the first manager on a part-time basis. Continued growth soon changed the position from part-time to full-time and later required the hiring of a clerk. Our current Mannager, Lois Kriger has been very effiently handling credit union operations since May 18, 1981.
The 45th Annual Meeting was held March 30, 1984, at the Legion Club. This was a substantial growth year for the credit union. Assets increased by nearly 13.0%, savings by 12.7%, and loans at an incredible rate of 45.0%.
Originally dividends were declared annually on share of deposit at the end of each calendar year. They were later delcared semi-annually. For the first 40 years, the computation and posting of all transactions were accomplished manually. The credit union operation was computerized in January 1979 and switched to an inhouse computer system in April 1987 which permitted dividends to be declared and posted quarterly. Dividends are currently calculated monthly and posted quarterly.
Through the years many changes were made and goals reached. 1963 was the first year the Federal Government (IRS) required the credit union to report any dividends (interest) earned over $10.00 and paid to a member.
As the needs of the members changed, the credit union has tried to accommodate these changes by offering the following services:
- Travelers Checks
- Cashiers Checks
- Leasing
- Notary Public Services
- Worlds of Fun/Oceans of Fun Tickets
- Christmas Club Accounts
- Members Prime Club
- Term, Life, Auto, Disability Insurance
 Federally insured by NCUA |
550 South 16th Street P.O. Box 94600 Lincoln, NE 68509-4600 |
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