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White House reps meet with CUNA on GSE reform

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WASHINGTON (4/23/14)--White House officials requested an exclusive meeting with the Credit Union National Association Tuesday and CUNA leaders discussed credit union priorities regarding housing finance reform policy issues.
 
The meeting with CUNA was one of a series the White House scheduled with top financial industry trade associations and other key stakeholders, held in advance of a scheduled April 29 markup by the Senate Banking Committee of its extensive housing finance reform bill. CUNA has also participated in recent White House meetings with groups of stakeholders.
 
The Tuesday meeting involved members of the White House Interagency GSE Reform Working Group. 
 
CUNA underscored at the meeting that the top three issues for credit unions are:
  • The bill's regulatory burden on credit unions;
  • Ensuring that the housing finance market remains accessible to credit unions and other smaller institutions; and,
  •  Giving credit unions representation in governance of the new federal entities envisioned under the proposal.
CUNA reminded that restructuring the system is "unchartered and untested" territory and therefore raises numerous questions regarding fees and functionality when applied to the real-world marketplace.

Representing CUNA at the meeting were President/CEO Bill Cheney, Chief Economist Bill Hampel, General Counsel Eric Richard, Deputy General Counsel Mary Dunn, Senior Vice President of Legislative Affairs Ryan Donovan, and Assistant General Counsel for Special Projects Robin Cook joined in the meeting.

The Senate Banking Committee bill was drafted by its chairman, Sen. Tim Johnson (D-S.D.), and its ranking Republican member, Sen. Mike Crapo (Idaho).  It is currently the focus of a drive by its authors to build unshakeable bi-partisan support before the panel considers the draft.
Reports have circulated in recent weeks that the April 29 markup could be delayed, but it is widely believed that a vote will occur next week.

Also this week, CUNA Housing Finance Reform Task Force member Bill O'Brien, from Suffolk FCU, Medford, N.Y., is invited to a meeting on housing finance reform today with Department of Housing and Urban Development Secretary Shaun Donovan.

CFPB warns private lenders can send students to early default

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WASHINGTON (4/23/14)--Some private student lenders are demanding full payment of a loan when a co-signer, such as a parent, has died or filed for bankruptcy, a practice that drives many loans directly into default, the Consumer Financial Protection Bureau reported on Tuesday.

This practice, CFPB Student Loan Ombudsman Rohit Chopra said, is happening even when the borrower is making monthly, timely payments on their loan. The information is included in the CFPB's mid-year report on the private student loan market, which examines more than 2,300 private student loan complaints and more than 1,300 student loan debt collection complaints received by the bureau between Oct. 1 and March 31.

Credit unions are not mentioned in the report.

While many private student lenders claim to give borrowers the option of releasing a co-signer's signature after a given period of time, the language in these documents is often hard to decipher, the CFPB said. Further, many student loan borrowers said they have faced issues when they tried to activate these clauses in their loan contracts.

The CFPB in a blog post provided advice and sample letters for student loan borrowers who are facing this issue.

For the CFPB report, use the resource link.
 
 

FEMA launches 'PrepareAthon' campaign

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WASHINGTON (4/23/14)--The Federal Emergency Management Agency--FEMA for short--is launching a "PrepareAthon!," a nationwide campaign to improve the country's resilience during and after an emergency situation.

Registration is open now for the April 30 event--being billed by FEMA as the first National Day of Action.  FEMA says participants will learn what to do before a tornado, wildfire, flood, or hurricane strikes their community.  Credit unions have helped their members and communities through each one of these natural disasters in recent years.

The session will share preparedness tips for family, community, and business.  It will provide preparedness resources, such as:
  • "How-to" guides;
  • Preparedness playbooks;
  • Promotional materials;
  • Events calendar;
  • Discussion groups; and
  • Additional resources tailored to specific hazards and audiences.
Use resource link to register.

NCUA circulates call report deadline reminder, warning

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ALEXANDRIA, Va. (4/23/14)--The National Credit Union Administration is circulating this reminder and warning: Credit unions failing to meet the April 25 call report filing deadline are potentially subject to civil money penalties.

The NCUA put late-filers on notice in January with a Letter to Credit Unions (14-CU-03). The agency called filing tardiness a "serious problem" that impacts its ability to conduct effective off-site supervision and drains agency resources. Late filings also delay the release of quarterly industry data to the general public.

The NCUA attached that January letter to the reminder its sent Tuesday to credit union directors and CEOs.

Potential penalties for late filers include:
  • Up to a maximum of $2,000 per day for each day a required report is "minimally" late or contains uncorrected false/misleading information if the late or false/misleading filing is unintentional and the credit union has reasonable procedures in place to avoid such errors;
  • Up to a maximum of $20,000 per day for each day a required report is late or contains false/misleading information if the late or false/misleading filing is not covered by the "unintentional" safe harbor outlined above; or
  • Up to a maximum of $1 million, or 1% of total assets, whichever is less, per day if a federally insured credit union knowingly or with reckless disregard for accuracy submits a false or misleading report and fails to correct it.
Use the resource link to access the NCUA Letter to Credit Unions (14-CU-03).
 

Green NCUA highlights mark Earth Day

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ALEXANDRIA, Va. (4/23/14)--The National Credit Union Administration has had some real success in its green initiatives, the agency said Tuesday in a release that marked Earth Day.  The NCUA has worked to reduce consumption of electricity, cut water usage--resulting in a 423,000-gallon reduction from 2012's total--and institute in-office electronics recycling programs.

NCUA Chairman Debbie Matz said being a responsible corporate citizen and a good steward of the public trust is a priority for the agency, noting that the NCUA in 2013 not only took steps to reduce resource use, it also worked decrease the amount of waste produced, and make the agency more environmentally efficient.

Steps taken at the NCUA's central office included:
  • Receiving an ENERGY STAR certification from the U.S Environmental Protection Agency, scoring 86 out of a possible 100 points;
  • Beginning a load-shed program that reduces electrical consumption by using a generator to produce energy during high-demand days;
  • Reducing water usage by switching to low-flow faucets and toilets, resulting in a 423,000-gallon reduction from 2012's total water use;
  • Initiating a new recycling program for batteries, cell phones and small electrical devices; and
  • Reducing the number of print communications and replacing them with online versions.
 
"We encourage credit unions to make a similar commitment to increasing efficiency, reducing environmental costs and promoting greater environmental awareness in their operations," Matz said.
 
This year and every year credit unions mark Earth Day with a variety of community-oriented events and programs, ranging from planting trees to promoting tree-saving electronic statements to educating youth about the environment.

Today is NCUA's fin. lit. Twitter chat

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ALEXANDRIA, Va. (4/23/14)--The National Credit Union Administration's Twitter chat to share best practices for helping members increase their financial literacy is today.

It's scheduled to take place between 11 a.m. and noon (ET) and will be hosted by Kenneth Worthey, financial literacy and outreach analyst with NCUA's Office of Consumer Protection.

Followers can take part in the conversation by watching the agency's @TheNCUA Twitter feed and the #NCUAChat hashtag. Participants can also submit questions before the chat to socialmedia@ncua.gov.

The NCUA Twitter talk is part of National Credit Union Youth Week activities. From April 20-26, sunny beaches and rolling waves are being featured everywhere at credit unions to grab attention for this year's theme, which encourages young potential credit union members to "Catch the $ave Wave."

See resource links for more.
 

Senators seek GAO too-big-bank study refinements

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WASHINGTON (4/23/14)--As it develops a second report on "too-big-to-fail" banks and the benefits they may have received due to "perceived government support," a pair of senators have encouraged the Government Accountability Office (GAO) to be mindful to "compare apples to apples."  

The senators encouraged the GAO to consider important criteria and relevant questions that will help members of the U.S. Congress properly evaluate the GAO report.

The letter to the GAO was sent by Sens. Tom Carper (D-Del.) and Mark Kirk (R-Ill.).  The lawmakers charged that the GAO's first report on "too-big-to-fail" banks was incomplete and that lawmakers did not find it all that useful to their oversight responsibilities.

They pushed the GAO to beyond determining whether or not a "perceived funding advantage" exists and explore instead whether there is a  competitive advantage created by that perception.

The senators requested that the GAO, in its analysis, consider how the Dodd-Frank Act and other regulatory reforms may have impacted credit ratings and investor confidence in the market. Other items that should be added to the GAO's analysis include:
  • Whether portions of Dodd-Frank that ban bailouts can be circumvented;
  • If stress test protocols developed and implemented by the Federal Reserve have impacted risks taken by relevant bank creditors, and if the stress tests reduce the likelihood of large bank failures; and
  • How the current capital positions of large financial institutions compare to those taken before the financial crisis.
The senators also encouraged the GAO to limit its analysis to only U.S. banks, the eight firms that the Financial Stability Board has labeled "systemically important." The GAO should also exclude non-financial firms such as insurance companies and asset managers from its analysis, they said. 

Carper and Kirk also asked if the competitive advantage seen in the banking industry is disproportionate to the advantages large firms enjoy in other industries.