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Inside Washington (05/06/2009)
* WASHINGTON (5/7/09)--National Credit Union Administration (NCUA) Chairman Michael Fryzel said the Senate’s 91-5 vote in favor of the agency’s Corporate Credit Union Stabilization Fund and accompanying provisions such as increased borrowing authority was “an unmistakable affirmation by lawmakers that the credit union industry can and will take care of its own problems.” In a statement Fryzel lauded the strong support given to the Stabilization Program by the credit union movement and added, “As the legislation moves to the House, I encourage a similar level of activism by credit union leaders across the country.”… * WASHINGTON (5/7/09)--Any action on H.R. 1728, the Mortgage Reform and Anti-Predatory Lending Act of 2009, will have to wait until today after the House on Wednesday moved to postpone a vote on the bill. The bill, introduced by Reps. Brad Miller (D-N.C.) and Mel Watt (D-N.C.) in late March, would fight against some predatory lending practices and attempt to push the mortgage market toward more conventional fixed rate mortgages … * WASHINGTON (5/7/09)--Federal Reserve Board Chairman Ben Bernanke said Tuesday during testimony to the Joint Economic Committee that the Fed would release more information on how many institutions borrow money from its lending facilities and what kinds of collateral they are using (American Banker May 6). Bernanke’s announcement comes after policymakers complained about the Fed’s cash infusion to markets without congressional input. The Fed chief also told the committee that the central bank is committed to transparency and openness and continues to expand the range of information available on its website as its review of disclosure practices proceeds. Bernanke did not reveal results of banks’ stress tests during the testimony, but said that any bank needing more capital will be able to receive it from stock conversions and private sources--but not from the Treasury ... * WASHINGTON (5/7/09)--Federal regulators were faulted for the failure of Alpha Bank and Trust last October in Alpharetta, Ga., by a watchdog report issued Tuesday. The Federal Deposit Insurance Corp.’s inspector general said regulators should have been worried that the bank was growing beyond its business plan (American Banker May 6). When it failed, Alpha had $334 million in assets after being in business for 29 months. Poor underwriting, a reliance on high-cost funding, concentration on high-risk construction and residential development loans, and few risk management controls caused it to fail ... * WASHINGTON (5/7/09)--Richard Hunt is the new president of the Consumer Bankers Association (CBA), the trade group announced Tuesday. His role will be effective June 1. He succeeds former president Joe Belew, who died in January ... * WASHINGTON (5/7/09)--The public’s attention to stress tests conducted at 19 of the nation’s largest banks may negate the “whole point of stress testing,” according to Jaidev Iyer, a former risk management chief at Citigroup. The results are expected to be released today. Discussion of the tests from the Obama Administration to others could prevent regulators from being candid, said Bradley Sabel, former bank supervisor with the Federal Reserve Bank of New York. There is value to keeping discussions between banks and examiners private, and that fear of a market panic could prevent regulators from telling banks to make significant operational changes, he said. Simon Johnson, former chief economist with the International Monetary Fund, said the tests were a “clever stalling action.” Others, including Kevin T. Jacques, finance professor and former Treasury employee, said the Treasury may have been backed into a corner and felt that if it didn’t release the test results, the public would wonder what it was hiding ...


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