Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

Washington
Matz NCUA will review TDR standards
WASHINGTON (10/7/11)--The Credit Union National Association (CUNA) strongly supports a plan announced by the National Credit Union Administration (NCUA) to review its Troubled Debt Restructuring (TDR) policy, and has been raising TDR-related issues in meetings with agency staff, CUNA Deputy General Counsel Mary Dunn noted Thursday. State leagues have also weighed with the agency on these issues. Early Thursday, NCUA Chairman Debbie Matz said the agency would review its TDR policy in the near future. A timeline for the board review has not been set, but the agency told News Now that NCUA staff members are reviewing the TDR policy to make recommendations for change. TDR loans, which have very specific accounting and reporting requirements, occur when a credit union or other lender grants a concession to the borrower and modifies the terms of the loan based on the borrower’s financial situation. The financial statement notes and call report data associated with TDRs are also unique. Matz said the agency “supports credit union efforts to find creative solutions for members who need loan modifications to stay in their homes,” and added that the NCUA “is seeking solutions that would better assist credit unions which are working diligently to provide members with alternatives to foreclosure.” However, CUNA and others have followed up on credit union complaints that NCUA examiners have sometimes discouraged TDRs. Credit unions are also burdened by regulatory requirements that force credit unions to segregate TDRs and report TDR payments as delinquent until the member has made timely and consecutive payments for six months after the modification. This generally requires credit unions to manually track such payments, Dunn said. NCUA board member Gigi Hyland in July said an Interpretive Ruling and Policy Statement (IRPS) on TDRs, if released, would recommend that credit unions adopt charge-off, loan grading and modification frequency standards that are similar to those currently used by banks. Credit unions would be advised to create and implement their own limits on the number and frequency of loan extensions, loan deferrals, loan renewals and loan rewrites, and would need to develop effective risk management, reporting and internal controls related to these types of loans, Hyland said.


RSS print
News Now LiveWire
.@Filene's survey of 'every day people:' Unsettled by economic 'recovery,' income inequality See #NewsNow http://t.co/2PMVWaycm3
3 minutes ago
For the last 75 years, even in the most difficult of times, Mill Town #CU has been there for the community it serves. Read #NewsNow Tues.
13 hours ago
The 1st vid shows how consumer can become victim and, advice to those who think they've been targeted. http://t.co/hr9VHpzEze
17 hours ago
.@TheNCUA has released two videos designed to raise awareness of elder financial abuse. http://t.co/iddSxr7H40
17 hours ago
Celebrate #100MM with @MDDCCUA1 at Orioles v Blue Jays tonight at Camden Yards
17 hours ago