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Washington Archive

Washington

Rep. Peters adds voice to interchange debate

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WASHINGTON (2/1/11)—Rep. Gary Peters (D-Mich.) joined the growing congressional chorus urging interchange caution. In a recent letter, Peters told the Federal Reserve that its planned interchange regulations, “if not properly implemented,” could increase costs for consumers, limit consumer choice, and make it harder for credit unions to offer many services to their members. Peters in his letter to Fed Chairman Ben Bernanke noted that credit unions and other financial institutions are concerned that the Fed has not met with them to discuss the issues that interchange regulations could create. House Financial Services Committee Chairman Spencer Bachus (R-Ala.) and Rep. Jeb Hensarling (R-Texas) in their own joint letter to the Fed questioned the speed with which the interchange legislation was moved through Congress. Rep. Barney Frank (D-Mass.) has also written to warn the Fed of unintended and potentially harmful consequences of the interchange provisions, and, according to a recent Bloomberg News story, is willing to work with House Republicans to alter the Fed's interchange fee proposal. The House Financial Services Committee is set to take up the topic of interchange regulation implementation at a Feb. 17 hearing. The Fed’s interchange plan, which seeks to implement provisions enacted by the Dodd-Frank financial regulatory reform package, offers a dual framework for determining what the law calls "reasonable" interchange fees. One plan would provide issuers with a safe harbor of seven cents per transaction, and set a maximum interchange fee cap of 12 cents per transaction. An alternative framework would simply cap the maximum interchange fee at 12 cents per transaction. These safe harbors and/or caps would be reevaluated by the Fed every two years. The Credit Union National Association (CUNA) has expressed concern over the potential for higher fees or diminished debit card services for credit union members. While merchants have claimed that the savings created by the interchange changes would be passed on to consumers, CUNA President/CEO Bill Cheney in a recent Huffington Post editorial called those claims “spurious at best.” CUNA has also noted that the Fed’s planned $10 billion interchange regulation threshold would not work in practice, and has estimated that up to 67% of credit unions would lose money on their debit card programs if the interchange regulations reduced interchange-related revenues by 40%. No financial institution -- and more importantly, none of the millions of Americans who use their services -- is a winner here," Cheney added.

Inside Washington (01/31/2011)

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* WASHINGTON (2/1/11)--The White House’s withdrawal of Federal Housing Finance Agency (FHFA) director nominee Joseph Smith’s name is an indication of difficulties for an administration with numerous regulatory posts to fill, according to observers(American Banker) Jan. 31). Opposition to Smith’s nomination came as a surprise to some. But Senate Democrats did not schedule a confirmation vote after Senate Banking Committee Republicans, including ranking member Richard Shelby (R-Ala.), voiced opposition to the North Carolina bank commissioner. Republicans have since gained seats in both chambers of Congress, raising questions about future administration nominees for the FHFA post and other agencies. Also at stake is the future of government sponsored enterprises (GSEs). Some sources indicated Smith would side too closely with the Obama administration on the future of the GSEs. Republicans have taken issue with the taxpayer costs associated with the government takeover of Fannie Mae and Freddie Mac. Joseph Engelhard, a senior vice president with Capital Alpha Partners, disputed the notion that Republicans would reject any nominee the Obama administration would choose … WASHINGTON (2/1/11)--The Federal Reserve Board of Governors’ January Senior Loan Officer Opinion Survey on Bank Lending Practices addressed changes in the supply and demand for bank loans to businesses and households the past three months. Overall, the survey indicated that a modest number of banks continued to ease standards and terms for commercial and industrial (C&I) loans during the fourth quarter, while banks reported small mixed changes in their lending policies for other types of loans to businesses and households. Similarly, the respondents reported a moderate increase in demand for C&I loans but little change in demand for other types of loans. Survey respondents, particularly large banks, reported easing standards and most terms on C&I loans, especially to large and middle-market firms. Banks pointed to a more favorable or less uncertain economic outlook and increased competition from other banks or nonbank lenders as reasons for easing. Changes in standards and terms on loans to households were small and mixed. Banks again reported more willingness to make consumer installment loans, and a small fraction of respondents reported easing standards for approving consumer credit card applications. However, a few banks reported tightening terms on, or reducing the sizes of credit lines on existing consumer credit card accounts. Some banks reported having tightened standards on nontraditional residential mortgage loans, while others reported little change in standards on prime residential mortgage loans or home equity lines of credit … * WASHINGTON (2/1/11)--The Federal Housing Finance Agency (FHFA) announced Monday it is consolidating its three offices here into a single location at Constitution Center, 400 Seventh St., SW. The FHFA was created in 2008 by merging the Office of Federal Housing Enterprise Oversight, the Federal Housing Finance Board, and staff from the U.S. Department of Housing and Urban Development The new, single location is intended to improve efficiency, and allow for expansion in, and greater integration of, FHFA’s examination and supervisory personnel and programs … WASHINGTON (2/1/11)--Republication lawmakers announced legislation last Friday to repeal the Home Affordable Modification Program (HAMP) (American Banker) Jan. 31). Rep. Darrell Issa (R-Calif.), the chairman of the Oversight and Government Reform Committee, and his colleagues said the Treasury Department’s program to help troubled borrowers avoid foreclosure has been “a colossal failure.” HAMP is intended to offer homeowners facing foreclosure help by reducing monthly payments to sustainable levels, according to the Treasury Department. Despite record levels of new foreclosures--2.9 million in 2010 and a projected 3 million in 2011--as of Dec. 21 only 522,000 homes were still in the program undergoing permanent modification. More than 792,000 trial modifications have been cancelled, and 152,000 trial modifications have yet to be upgraded to permanent status …

National MLO registry is up and running

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WASHINGTON (2/1/11)--The Conference of State Bank Supervisors' (CSBS) Nationwide Mortgage Licensing System & Registry (NMLS) has been upgraded to allow banks and credit unions to register their mortgage loan originators (MLOs), and became fully active on Monday. The Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) requires credit union mortgage loan originators and their employing institutions to register with the NMLS. MLOs will have 180 days to complete the initial round of NMLS registrations. Initial registration will run until July 29, 2011. Credit unions will be required to ensure that their mortgage loan originators are properly registered and prohibit any employees who are not registered from performing any residential mortgage loan origination duties. Residential mortgage loans, including home equity loans, are covered by the SAFE registration rules. However, unregistered MLOs that have originated five or fewer mortgage loans during the previous year will not be required to complete the federal registration process, according to a Federal reserve release. The NMLS Resource Center has scheduled a series of NMLS workshops, which will begin today. The workshops, which will run until March 24, will address account initiation and user registration, as well as how to create mortgage loan originator accounts and records and to manage filing MU4R forms and related fees. MLO training and employee management will also be covered. The Credit Union National Association (CUNA) has also provided its own SAFE Act compliance guide. For that guide, which is available only to CUNA members, use the second resource link. For more on the NMLS changes and the NMLS Resource Center and CUNA NMLS resources, use the resource links.

House leader Boehner to address CUNAs GAC

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WASHINGTON (2/1/11)--Speaker of the House Rep. John Boehner (R-Ohio) will address the Credit Union National Association’s (CUNA) 2011 Governmental Affairs Conference (GAC) in Washington on March 2. “Given his very busy schedule and many responsibilities, we are truly honored to have the Speaker join us at our industry’s premier governmental event,” said CUNA President/CEO Bill Cheney. “We view his acceptance of our invitation as recognition of the work credit unions do to provide affordable financial services to millions of American consumers, and we look forward to hearing Mr. Boehner’s comments on the House priorities in the year ahead,” Cheney added.
Click to view larger image CUNA President/CEO Bill Cheney, right, meets with Rep. John Boehner (R-Ohio), who is now the new Speaker of the House, in August. Boehner was one of many members of the House that met with Cheney during his first weeks as CUNA leader.
House Financial Services Committee Chairman Rep. Spencer Bachus (R-Ala.), fellow committee member Rep. Ed Royce (R-Calif.) and Senate Banking Committee member Sen. Jon Tester (D-Mont.) will join Boehner on the lineup of GAC speakers. Congressional colleagues Rep. Shelley Moore Capito (R-W.Va.), Sen. Roy Blunt (R-Mo.), Sen. Mike Crapo (R-Idaho), and Reps. Barney Frank (D-Mass.), Debbie Wasserman Schultz (D-Fla.), Sen. Mark Udall (D-Colo.) and Steve Stivers (R-Ohio) are also set to speak. Consumer Financial Protection Bureau architect Elizabeth Warren and co-authors of The New York Times No. 1 best-seller "Game Change" Mark Halperin and John Heilemann are also scheduled to address GAC attendees. The GAC will also feature keynote speeches from actor and Children's Miracle Network Hospitals co-founder John Schneider and "Miracle on the Hudson" pilot Captain Chesley B. "Sully" Sullenberger III. The 2011 GAC will begin on Feb. 27 and end on March 3. To register for the GAC, use the resource link.

Fed announces start of NMLS

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WASHINGTON (UPDATED: 12:15 P.M. ET, 1/31/11)--The Conference of State Bank Supervisors' (CSBS) Nationwide Mortgage Licensing System & Registry (NMLS) has been upgraded to allow banks and credit unions to register their mortgage loan originators (MLOs), and became fully active earlier today. The Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act) requires credit union mortgage loan originators and their employing institutions to register with the NMLS. MLOs will have 180 days to complete the initial round of NMLS registrations. Initial registration will run until July 29, 2011. Credit unions will be required to ensure that their mortgage loan originators are properly registered and prohibit any employees who are not registered from performing any residential mortgage loan origination duties. Residential mortgage loans, including home equity loans, are covered by the SAFE registration rules. However, unregistered MLOs that have originated five or fewer mortgage loans during the previous year will not be required to complete the federal registration process, according to a Federal reserve release. The NMLS Resource Center has scheduled a series of NMLS workshops, which will begin on Feb. 1. The workshops, which will run until March 24, will address account initiation and user registration, as well as how to create mortgage loan originator accounts and records and to manage filing MU4R forms and related fees. MLO training and employee management will also be covered. The Credit Union National Association (CUNA) has also provided its own SAFE Act compliance guide. For that guide, which is available only to CUNA members, use the second resource link. For more on the NMLS changes and the NMLS Resource Center and CUNA NMLS resources, use the resource links.