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Washington Archive

Washington

NEW: CU Earnings Set $85B Record In 2012

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ALEXANDRIA, Va. (3/1/13, UPDATED: 10:30 a.m. ET)--"Credit unions had a pivotal year in 2012," recording $8.5 billion in earnings in that year, National Credit Union Administration Chairman Debbie Matz said in a release announcing credit union financial figures for 2012.

The $8.5 billion earnings total is the highest figure ever for the credit union industry, according to the agency.

Matz said federal credit unions "generated record earnings; assets crossed the $1 trillion mark; and membership grew by more than 2 million. The industry net worth ratio rose to 10.44%, and delinquencies fell again."

She also noted that credit union lending grew by 4.6%, "meaning more people got the loans needed to buy homes, purchase cars, and go to school."

These and other NCUA figures are based on Call Report data submitted to and compiled by the agency for the quarter ending Dec. 31, 2012.

For more on the numbers, and CUNA analysis, watch News Now. For an NCUA release on the credit union stats, use the resource link.

CompBlog: CMG Gives Insight on Single-premium Credit Insurance Ban

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WASHINGTON (3/1/13)--CompBlog is featuring a post focusing on a rule that bans financing of any premiums or fees for payment protection products in connection with a consumer credit transaction secured by a dwelling, but allows the products to be paid for on a monthly basis.

Guest blogger David Tomar of CUNA Mutual Group offers "a few points to keep in mind" regarding the Dodd-Frank Act revision of Section 1414 of the Truth in Lending Act. CompBlog is a highly regarded source of compliance information provided by the Credit Union National Association to its members.

Tomar notes the Consumer Financial Protection Bureau created an implementing rule in January. It goes into effect June 1.

Tomar writes that taking a moment to understand what types of mortgage loans are affected is important.

He blogs:

  • A creditor may not finance, directly or indirectly, any premiums or fees for [payment protection] in connection with a consumer credit transaction secured by a dwelling (including a home equity line of credit secured by the consumer's principal dwelling). This prohibition does not apply to credit insurance for which premiums or fees are calculated and paid in full on a monthly basis. 12 C.F.R. 1026.36(i).
Credit unions can expect this rule might change over time, reflecting the CFPB's philosophy that the regulatory system needs to be flexible, as well proactive, the blog post warns.

"That is why we can expect the bureau to continually evolve and develop its positions on this and other issues. Exactly how that will occur is difficult to predict. What we do know is that we will have to learn and adjust along with the bureau," Tomar writes.

CUNA members can access the link below to read five points to keep in mind about the rule.

GAC Apex: Credit Union Boots Traverse Capitol Hill

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WASHINGTON (3/1/13)--Thousands of credit union advocates streamed into the halls of the U.S. Congress this week urging their elected representatives to maintain the credit union tax status, reduce the regulatory burden, and take action to enhance the credit union charter--among other things--as an integral part of the Credit Union National Association's  2013 Governmental Affairs Conference.

Click for slide show Credit unions concluded this year's GAC with Capitol Hill visits on Wednesday and Thursday, bringing a unified message of the good the credit union difference does for their communities. This slideshow brings you illustrations of just some of those meetings. (CUNA photo)

The GAC brought some of the nation's top lawmakers and financial institution policymakers to present their views to the gathered credit union participants, more than 4,200 in total. In addition, CUNA President/CEO Bill Cheney unveiled a comprehensive and first-ever "vision" for the credit union movement as a whole--a vision in which "Americans choose credit unions as their best financial partner."

The effort to rally in support of the vision for the movement--captured by the phrase "Unite for Good"--is rooted in credit unions' shared values: Collaboration, a focus on members, community involvement, and a dedication to financial well-being. "People want to do business with people who have their best interests at heart," Cheney said.

Cheney emphasized that a unified voice will be needed to achieve this vision, and while every credit union group had a unique story to tell their respective congressional representatives, collectively credit unions spoke in a unified voice on several common themes: Credit unions' tax status, the need for supplemental capital and greater member business lending authority, and support for recently introduced privacy notice legislation.

Prior to the GAC, CUNA created a new members-only tax toolkit, which is designed to help credit unions connect with their members and educate the public and policymakers about the importance of the credit union tax status. (For more on toolkit, use the resource link)

Under the GAC umbrella this week, credit unions met with their lawmakers in venues ranging from large receptions scheduled around breakfast, lunch, or dinner, "behind the curtain" before and after GAC speeches; in small huddles in congressional offices; and in the packed offices of senators and house members.

The visits were superbly timed to give credit unions a chance to meet with both long-time and newly elected members of the 113th Congress

Something Is In the Air At CUNA: It's Not Spring

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WASHINGTON (3/1/13)--Something's coming. It's smart. It's big. It's beautiful. It's from the Credit Union National Association.

"CUNA has the best, most comprehensive information, products and services available to the credit union world," says Paul Gentile, executive vice president of strategic communications and engagement. "What we had to fix is how credit unions can find it."

Gentile said a soon-to-be-launched, updated and improved CUNA website will feature state-of-the-art navigational tools, a dream search function, and interactive features.

"We are leaving behind the static and confusing. It's all going to be about user-friendly and appealing," Gentile says. "You're going to want to stay tuned for this."

Rep Waters Questions FHFA's Force-Place Insurance Decision

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WASHINGTON (3/1/13)--Rep. Maxine Waters (D-Calif.) Thursday questioned the acting head of the Federal Housing Finance Agency about the agency's recent decision to block Fannie Mae from moving forward with a plan to lower force-placed insurance premiums for homeowners and instead opting to study the issue.

Under standard mortgage terms, borrowers are contractually obligated to maintain hazard insurance. In the event that homeowners fail to maintain such coverage, mortgage servicers are entitled to buy force-placed coverage on their behalf and bill the homeowners.

Waters, the ranking Democratic member of the House Financial Services Committee, wrote to FHFA's Edward DeMarco that Fannie Mae's plan could have saved "taxpayers and borrowers from unnecessarily high costs related to force-placed insurance."

"Evidence suggests that force-placed insurance can cost up to ten times more than voluntary homeowners insurance, and that these excessive insurance costs increase the debt owed by borrowers and there impose unnecessary losses on guarantors such as the government-sponsored enterprises you are charged with conserving," Waters wrote in a Feb. 27 letter. FHFA is conservator of both Fannie Mae and Freddie Mac.

Waters asked DeMarco to provide an explanation of the agency's decision to reject Fannie's proposal, a list of the FHFA's outside stakeholders who informed the agency's decision, and an outline of its plan, if there is one, on how to proceed with force-paced insurance reform.

Credit Union National Association General Counsel Eric Richard has noted that consumer abuse in the forced placement market has attracted the attention of the Consumer Financial Protection Bureau.

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NCUA Issues New Prohibition Orders

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ALEXANDRIA, Va. (3/1/13)--The National Credit Union Administration has issued orders prohibiting former credit union employees in Oklahoma and Texas from any future involvement with federally insured financial institutions.

The following individuals have been banned, according to the agency:

  • Cindy Dechant, a former employee of Associated Blind of Oklahoma/Texas FCU in Oklahoma City, Okla., pleaded guilty to a charge of bank fraud. Dechant was sentenced to 42 months in prison, three years of supervised release, and ordered to pay restitution in the amount of $194,297.94; and
  • Theresa Portillo, a former employee of Women's Southwest FCU in Dallas, Texas, consented to the issuance of a prohibition order to avoid the time, cost and expense of administrative litigation.
NCUA enforcement orders are available online (use resource link) and available for inspection at NCUA's Office of General Counsel between 9 a.m. and 4 p.m. (ET) Monday through Friday. Copies may be ordered by mail from NCUA, 1775 Duke St., Alexandria, VA 22314-3428.

Violation of a prohibition order is a felony offense punishable by imprisonment and a fine of up to $1 million.