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CU info on SBA loans CUNA audio call

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WASHINGTON (12/16/08)—Credit unions will be able to get important information on U.S. Small Business Administration (SBA) by participating in a Dec. 22 Credit Union National Association (CUNA) audio call. The audio call is titled “SBA Lending For Credit Unions: Opportunities and Challenges in the Current Economic Environment.” It will explore the challenges the current economic environment is posed for credit unions and other who participate in SBA lending, as well provide information on how credit unions can participate in SBA programs. Among the speakers participating in the call will be Frank Kressman, staff attorney with the National Credit Union Administration (NCUA), Grady Hedgespeth, SBA's Director of Financial Assistance, and Nicholas Owens, National Ombudsman and Assistant Administrator for Regulatory Enforcement Fairness at the SBA, who will moderate the program. The agency experts will also discuss NCUA's member business lending requirements and how they impact SBA lending. Use the resource link below to register for next Monday’s audio call.

Register now for todays CU HARP CU SIP webcast

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ALEXANDRIA, Va. (12/16/08)--Credit unions now can register for a no-charge audio webcast focusing on details of the two newly announced National Credit Union Administration (NCUA) programs to assist credit union mortgage holders and corporate credit unions. It happens today at noon ET. The audio webcast will offer credit unions information about how they can participate in the "Credit Union Homeowners Affordability Relief Program (CU HARP)" and the "Credit Union System Investment Program (CU SIP)." The NCUA, Credit Union National Association (CUNA), state leagues and the National Association of Federal Credit Unions are hosting the event. The new time is a change from last week's CUNA announcement. It is in response to high demand for the one-hour event. The NCUA programs are designed, respectively, to lower monthly mortgage payments for struggling low- and moderate-income credit union members, and to free up collateral pledged by corporate credit unions and thereby provide increased contingent borrowing capacity. Both programs rely on the NCUA-administered Central Liquidity Facility (CLF) to provide funding. The CUNA program will feature two NCUA officials:
* CLF President Owen Cole, and * CLF Vice President Steve Sherrod.
The two federal officials will present details of the two programs and answer questions from conference participants. Use the resource link below to register.

CUNA urges quick signing of pension bill

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WASHINGTON (12/16/08)—The Credit Union National Association (CUNA) urged President George W. Bush to sign a bill that would give organizations some flexibility in shoring up pension plans hurt by the current economic upheaval. H.R. 7327, the Worker, Retiree, and Employer Recovery Act was approved last week by the U.S. Congress to amend the Pension Protection Act of 2006. One of the changes would allow organizations with defined benefit pension plans to phase in funding targets over three years. CUNA President/CEO Dan Mica wrote in his letter to the President: “The decline in the market value of equity assets held in defined benefit plans has caused plans that were once fully funded to fall below the capitalization levels required under the Pension Protection Act of 2006. “As a result, many organizations face the prospect of being required to shift operating capital into their defined benefit pension accounts.” The broader three-year timeframe is critical to viability of existing plans during the country’s current difficult economic times, said Mica, and he urged Bush to sign the act into law.

Hyland to CU volunteers Your job is critical

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WASHINGTON (12/16/08)—National Credit Union Administration (NCUA) board member Gigi Hyland told an audience of credit union volunteers recently that while their “jobs” are tougher than ever, they are also more critical to the success of the credit union system. “As volunteers, you are charged with assuring that the spirit of ‘people helping people’ continues,” Hyland said at last week’s Credit Union Executive Society’s Directors Conference in Palm Desert, Calif. Hyland said the role of volunteer requires an individual to “be active, informed, knowledgeable, visionary, and constantly challenge and question management’s assumptions.” “You are your institution’s first line of defense in risk management. These turbulent economic times require the utmost vigilance on the part of the regulator and the regulated. These times also require innovation,” she said. Regarding innovation, Hyland urged volunteers to look at:
* The larger credit union system to seek ways to cooperate and leverage resources, and utilizing capital wisely to weather the current turbulent economic climate; * Understanding your current field of membership, its diversity and making sure that your board and staff look like your membership and are responding to what your members’ need; and * Recognizing that now is not the time to cut back on marketing or member services.
“As I stated earlier, despite the challenges, this is a time of tremendous opportunity for credit unions – a time to continue to do what you do best – serve your members and meet their needs in a manner that is safe and sound,” Hyland said.

Treasury cuts bank taxes yet pushes UBIT says CUNA

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WASHINGTON (12/16/08)—In its attempts to address the national crisis in the financial markets, the U.S. Treasury Department is creating a “disturbing disparity” in the tax treatment of different kinds of depository institutions and is favoring banks, according to the Credit Union National Association (CUNA). CUNA has requested a meeting with Treasury Secretary Henry Paulson and Internal Revenue Service Commissioner Douglas Schulman to discuss recent actions that CUNA said have showered banks with tax relief to help them survive the current financial crisis, while credit unions needs have not been addressed. To make matters worse, CUNA said in its letter to the Treasury and IRS, state-chartered credit unions continue to have unrelated business income tax (UBIT) claims piled on them. The IRS’s aggressive re-interpretation of law to increase the tax liabilities of state-chartered credit unions under UBIT leaves “less funds for them to lend,” CUNA President/CEO Dan Mica pointed out in the letter. “This harsh position has imposed substantial burdens on credit unions, diverting funds which might better be used to provide loans to consumers for homes, cars and education,” Mica wrote. Noting the “urgent circumstances,” Mica requested that the IRS be directed to halt its efforts against credit unions, and a meeting be scheduled to “discuss this significant issue.”

Inside Washington (12/15/2008)

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* WASHINGTON (12/16/08)--Though lawmakers are pushing the Treasury Department to track how banks are using Troubled Asset Relief Program (TARP) funds, doing so may be difficult, industry representatives say. Bankers can’t identify exactly where the money is spent because it’s applied to their balance sheets, said William Longbrake, Federal Home Loan Bank of Seattle director (American Banker Dec. 15). Last week, the House approved an amendment to an auto bailout bill that would require banking companies to report changes in lending. The bill has since died in Congress, but some representatives say lawmakers will continue to push bankers to detail their TARP funds use next year ... * WASHINGTON (12/16/08)--Bankers in the Federal Deposit Insurance Corp. (FDIC) debt guarantee program will be allowed to change their applications after roughly 500 institutions say they signed up for the program’s advanced version under the impression that its benefits were free (American Banker Dec. 15). In addition to the 500 thrifts, holding companies and banks, the agency is contacting 300 others to let them know they can participate in the standard program without extra charges. The guarantee program was launched in October to help credit markets. It charges 50 to 100 basis points for coverage of senior unsecured debt. The advanced program covers newly issued debt up to three years ... * WASHINGTON (12/16/08)--The Small Business Administration (SBA) has awarded four small business development centers in Idaho, Nebraska, Nevada and New York Small Business Sustainability Initiative Grants totaling $500,000 to fund projects offering energy efficiency assistance to small businesses. The centers include: The New York Small Business Development Center at the Research Foundation of the State University of New York, Albany; The Nevada Small Business Development Center at the University of Nevada, Reno; The Nebraska Small Business Development Center at the University of Nebraska, Omaha; and The Idaho Small Business Development Center at Boise State University, Boise. The grant winners proposed programs that provide education, training, energy efficiency audits, information about adoption of energy efficiency and energy conservation practices, and help with purchasing and installing energy efficient building fixtures and equipment, the SBA said ...