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Washington

NEW Senators add support for CURIA

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WASHINGTON (6/4/08, UPDATED 12:00 p.m. ET)-—Sens. Susan Collins and Olympia Snowe, both Maine Republicans, have signed on in support of the Senate bill (S. 2957) intended to modernize the regulatory structure for credit unions and provide more choices in services for their member-owners.
That bill, the Credit Union Regulatory Improvements Act (CURIA), was introduced in April by Sen. Joseph Lieberman (ID-Conn.). A House version of the regulatory improvements package (H.R. 1537) carries the names of 149 official backers. Collins and Snowe join Rep. Bernard Sanders (I-Vt.) as co-sponsors of the bill. Sanders penned his name to the bill on May 14. Collins called the legislation “an opportunity for credit unions to better serve the thousands of small business owners in Maine and the millions across the country, as well as provide affordable financial services to more low-income consumers.” “I understand the economic benefit that credit unions provide to communities and consumers, and, during these difficult economic times, the ability of credit unions to offer additional services and operate more efficiently is more important than ever,” Collins said in a statement noting her support. Maine’s Snowe said, “Maine credit unions play an essential role in our state’s economy. Increasing credit unions’ ability to make member business loans will increase small firms’ access to capital and help to stimulate local economies throughout Maine and the country. “As the ranking member of the Senate Committee on Small Business and Entrepreneurship, I know first-hand that Maine’s credit unions are ideally positioned to help expand Maine’s economy, drive economic development, and create jobs.” Credit Union National Association (CUNA) President/CEO Dan Mica today said, "On behalf of credit unions across the nation, our thanks to Sens. Snowe and Collins for their support of credit unions in co-sponsoring CURIA.” He added, “And kudos to the Maine League and Maine credit unions for working so effectively with their senators. It is appropriate for credit unions across the country to now express their thanks, in e-mails and letters, to the two Maine senators for their solid support for our legislation – and our future." In early May, CUNA contacted each member of 110th U.S. Senate to urge support of S. 2957. CUNA’s Mica wrote that by co-sponsoring CURIA, lawmakers are "helping credit unions continue their mission of serving working families, making needed services available to lower-income or underserved consumers, and helping promote economic growth and well being in our nation's communities." Beyond that, Mica noted, CURIA will also improve the quality of services to credit union members by updating or removing other burdensome regulations. The letter included an attachment with specific information about important reforms within CURIA. In part, CURIA proposes to:
* Modernize credit union capital standards to permit more efficient capital management while allowing more earnings to be returned to members in lower costs and expanded services; * Expand the ability of credit unions to make loans to finance their members' local small businesses; and * Permit more credit unions to offer needed services in lower income communities that are not adequately served by other depository institutions.
In addition to the Small Business Administration Committee, Snowe’s committee assignments include Finance, which addresses issues relating to taxes, health care, trade and Social Security. Collins is ranking member and former chairman of the Homeland Security and Governmental Affairs Committee, which has jurisdiction over the Department of Homeland Security and is the Senate’s chief oversight committee. Maine CU League President John Murphy thanked the senators for their leadership roles in becoming early co-sponsors of CURIA. “Sens. Collins and Snowe have a long history of supporting credit unions and consumers, and this legislation is about helping credit unions help consumers. Both senators are well-respected by their colleagues regardless of party affiliation and having them as early co-sponsors provides this legislation with a solid foundation to move forward and gain additional co-sponsors.

CU-backed candidates advance

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WASHINGTON (6/5/08)—Credit union-backed candidates in New Jersey and New Mexico won primaries this week for seats in the U.S. Senate, as did one candidate for a U.S. House seat in California. And two candidates with credit union support, vying for U.S. House slots in Alabama, have successfully advanced to run-off races in their state on July 15. The Credit Union National Association and state leagues supported the following candidates: In New Mexico, U.S. House member Steve Pearce won the Republican primary in the race to replace retiring Sen. Pete Domenici, also a Republican. Pearce currently is a member of the House Financial Services Committee and a co-sponsor of H.R. 1537, the Credit Union Regulatory Improvements Act (CURIA). He will face Rep. Tom Udall (D-N.M.) in the general election. Incumbent Sen. Frank Lautenberg (D-N.J.) defeated Rep. Rob Andrews (D-N.J.) in their state’s Democratic primary. Lautenberg will oppose former Republican Rep. Dick Zimmer in the general election. On the other side of the country, Californian Duncan D. Hunter, son of CURIA cosponsor and former presidential hopeful Rep. Duncan Hunter (R-Calif.), easily won his four-way primary with 73% of the vote. Also advancing in their races:
* State Rep. Jay Love (R) of Alabama moved ahead in his race for a U.S. House seat vacated by retiring Rep. Terry Everett (R-Ala.). On July 15, Love will be in a run-off election against community banker and state senator, Harri Anne Smith; and * Also in Alabama, credit union-backed candidate and casualty insurance executive Wayne Parker will be in a GOP runoff against Huntsville-based attorney Cheryl Guthrie. Parker and Guthrie are seeking the Republican nomination to replace retiring incumbent Rep. Bud Cramer (D-Ala.)
Each successful candidate received $5,000 from CUNA’s Credit Union Legislative Action Council (CULAC). Of the Alabama race, Alabama CU League President Gary Wolter said Wednesday, “We were very pleased by the results of Tuesday’s primary, Both Wayne and Jay have shown themselves to be leaders that understand credit unions, and our issues, and how important credit unions are for so many people. We look forward to continuing to work with them during the next phase of the campaign.”

Inside Washington (06/04/2008)

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* WASHINGTON (6/5/08)--Several regulatory changes to the financial system to reduce its vulnerability are on the way, Federal Reserve Board Chairman Ben Bernanke said in a speech before attendees of the International Monetary Conference in Barcelona, Spain, Tuesday. “Among the changes we expect to see are strengthening of capital and liquidity rules, greater disclosure requirements, an increased emphasis on the measurement and management of firmwide risks, and further steps to increase the transparency and resilience of the financial infrastructure,” he said. The Fed hopes to achieve a “more effective balance” between market discipline and regulation, he added. He also noted that the Fed and the Treasury continue to monitor developments in foreign exchange markets, and reiterated the Fed’s measures to ensure that financial institutions have adequate access to central bank liquidity ... * WASHINGTON (6/5/08)--The Financial Accounting Standards Board plans to scrap qualified special-purpose entities (QSPEs) in FAS 140 (American Banker June 4). If approved, the revision would be effective June 2009. Deliberation on the new standard is expected this month, and a public comment period will be set in July. A roundtable, where critics will be invited to meet with the board, is slated after the comment period. Banks and other financial institutions had improperly used QSPEs to securitize prepackaged loans. Under the new standard, companies will have to decide whether to put the entities on the balance sheet(CFO.com June 2) ... * WASHINGTON (6/5/08)--The Federal Deposit Insurance Corp. (FDIC) will sponsor a forum on mortgage lending for low- and moderate-income (LMI) households July 8. The purpose of the forum is to explore a framework for mortgage lending in the future, including identifying market and regulatory incentives for encouraging responsible lending. Speakers include: Henry Paulson, Treasury Secretary; Ben Bernanke, Federal Reserve Board chairman; and James Dimon, CEO and board chairman of JP Morgan Chase and Co. Topics include: Back to Basics, Reintroducing Standard Underwriting Criteria and Pricing to the LMI Mortgage Market; Reasonable, Profitable and Innovative Approaches to LMI Mortgage Lending; and Building Relationships, Building Communities: Partnerships that Foster Home Ownership ... * WASHINGTON (6/5/08)--If he is elected president, Sen. Barack Obama (D-Ill.) says he would offer several programs to protect consumers. He would encourage credit unions to provide short-term loans to the underserved and would try to cap interest rates on payday loans at 36% (American Banker June 4). He would create a $10 billion foreclosure prevention fund paid for by penalties given to lenders who engage in fraud, Obama said. The senator also proposed extending the Federal Reserve Board’s supervisory authority over institutions who borrow from the Fed, which contrasts with the Treasury’s blueprint to keep the Fed as a market stability monitor. Referencing a March 27 speech made by Obama in New York, Daniel Tarullo, an economic adviser to the senator, said the candidate’s focus on regulatory reform is not normally seen in presidential candidates. Sen. John McCain (R-Ariz.) said in March that he didn’t support a government-backed bailout for mortgage lenders. Several weeks later, the senator supported a Federal Housing Administration plan by House Financial Services Committee Chairman Barney Frank (D-Mass.) and Senate Banking Committee Chairman Christopher Dodd (D-Conn). ...

Senators add support for CURIA

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WASHINGTON (6/5/08)-- Sens. Susan Collins and Olympia Snowe, both Maine Republicans, have signed on in support of the Senate bill (S. 2957) intended to modernize the regulatory structure for credit
U.S. Sen. Susan Collins (R-Maine), right, chats with Maine CU League President John Murphy prior to addressing a delegation of Maine credit union representatives in Washington, D.C. (Photo provided by the Maine CU League)
unions and provide more choices in services for their member-owners. That bill, the Credit Union Regulatory Improvements Act (CURIA), was introduced May 1 by Sen. Joseph Lieberman (ID-Conn.). A House version of the regulatory improvements package (H.R. 1537) carries the names of 149 official backers. Collins and Snowe Wednesday join Sen. Bernard Sanders (I-Vt.) as co-sponsors of the bill. Sanders penned his name to the bill on May 14. Collins called the legislation “an opportunity for credit unions to better serve the thousands of small business owners in Maine and the millions across the country, as well as provide affordable financial services to more low-income consumers.” “I understand the economic benefit that credit unions provide to communities and consumers, and, during these difficult economic times, the ability of credit unions to offer additional services and operate more efficiently is more important than ever,” Collins said in a statement noting her support.
U.S. Sen. Olympia Snowe (R-Maine), right, and Maine CU League President John Murphy at a special breakfast of Maine credit union representatives attending CUNA’s GAC in Washington, D.C. in March.
Maine’s Snowe said, “Maine credit unions play an essential role in our state’s economy. Increasing credit unions’ ability to make member business loans will increase small firms’ access to capital and help to stimulate local economies throughout Maine and the country. “As the ranking member of the Senate Committee on Small Business and Entrepreneurship, I know first-hand that Maine’s credit unions are ideally positioned to help expand Maine’s economy, drive economic development, and create jobs.” Credit Union National Association (CUNA) President/CEO Dan Mica Wednesday said, "On behalf of credit unions across the nation, our thanks to Sens. Snowe and Collins for their support of credit unions in co-sponsoring CURIA.” He added,“And kudos to the Maine League and Maine credit unions for working so effectively with their senators. It is appropriate for credit unions across the country to now express their thanks, in e-mails and letters, to the two Maine senators for their solid support for our legislation--and our future." In early May, CUNA contacted each member of 110th U.S. Senate to urge support of S. 2957. CUNA’s Mica wrote that by co-sponsoring CURIA, lawmakers are "helping credit unions continue their mission of serving working families, making needed services available to lower-income or underserved consumers, and helping promote economic growth and well being in our nation's communities." Beyond that, Mica noted, CURIA will also improve the quality of services to credit union members by updating or removing other burdensome regulations. The letter included an attachment with specific information about important reforms within CURIA. In part, CURIA proposes to:
* Modernize credit union capital standards to permit more efficient capital management while allowing more earnings to be returned to members in lower costs and expanded services; * Expand the ability of credit unions to make loans to finance their members' local small businesses; and * Permit more credit unions to offer needed services in lower income communities that are not adequately served by other depository institutions.
Collins is ranking member and former chairman of the Homeland Security and Governmental Affairs Committee, which has jurisdiction over the Department of Homeland Security and is the Senate’s chief oversight committee. In addition to the Small Business Administration Committee, Snowe’s committee assignments include Finance, which addresses issues relating to taxes, health care, trade and Social Security.
Audio file CUNA Legislative Affairs Senior Vice President explains the importance of growing Senate support for the Credit Union Regulatory Improvements Act. Click to watch.
Maine CU League President John Murphy thanked the senators for their leadership roles in becoming early co-sponsors of CURIA. “Sens. Collins and Snowe have a long history of supporting credit unions and consumers, and this legislation is about helping credit unions help consumers. Both senators are well-respected by their colleagues regardless of party affiliation and having them as early co-sponsors provides this legislation with a solid foundation to move forward and gain additional co-sponsors.

CUs a solution for consumers Mica tells FOX TV

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WASHINGTON (6/5/08)--Especially in today's tough economy, consumers will do well to turn to credit unions for a good deal on financial services, Credit Union National Association (CUNA) President/CEO Dan Mica told viewers of Fox Business Channel in a live television interview yesterday.
CUNA President/CEO Dan Mica prepares to discuss credit unions advantages for consumers during a live FOX Business Channel broadcast yesterday. (Photo provided by CUNA)
"Credit unions are one of the best places people can go in difficult times," Mica said, explaining credit unions typically offer better rates and lower fees because they are not-for-profit cooperatives. "They are not driven by that bottom line and shareholder needs," he said. "In fact every single member of a credit union is an owner of that credit union." Mica also explained why credit unions were not caught up in the subprime debacle, pointing out credit unions as not-for-profit co-ops operate more conservatively and are more apt to hold loans in portfolio. Mortgage delinquency and charge off ratios are both less than 1%, well below bank averages, he added. "Credit unions didn't make these no document loans, these liar loans, exotic loans. They're part of the solution, not the problem, and people who got those kinds of loans are now turning to credit unions for help." The CUNA leader also told Fox Business that most consumers can likely find a credit union they are eligible to join. He offered CUNA's creditunion.coop consumer web site, which includes a credit union locator tool, as a resource.

CUNA comment on NCUA honesty standard

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WASHINGTON (6/5/08)—Providing credit unions with guidance to interpret a statutory honesty standard for employees is a good idea, but the National Credit Unions Administration’s (NCUA’s) current plan needs a few changes to be most useful, according to the Credit Union National Association (CUNA. In a comment letter to the agency, CUNA said that the NCUA’s move to establish an interpretative ruling addressing provisions in the Federal Credit Union Act that prohibit persons convicted of criminal offenses relating to dishonesty, breach of trust and certain other offenses from participating in the affairs of a federally insured credit union may be helpful both to credit unions as well as to their examiners. Furthermore, the effort parallels guidance from the Federal Deposit Insurance Corp. and the Office of Thrift Supervisions for their regulated institutions. However, CUNA wrote, the NCUA should discontinue its informal process now used to review credit unions’ applications for prior approval and establish a more formal process. Among its other points, CUNA said:
* While the FDIC has similar guidance, it has also incorporated procedural provisions into its regulation to facilitate compliance for federally insured banks on these issues. CUNA supports this approach to the extent it will make it easier for credit unions to meet their responsibilities; * The FDIC has developed guidance for federally insured banks on pre-employment background screening that also addresses how the prohibition on persons convicted of certain crimes should be dealt with. NCUA should review this guidance and consider adopting it for credit unions, as appropriately modified; * NCUA should establish specific timeframes for when it will respond to consent requests and appeals, and address these issues in its regulations; and * NCUA should provide practical examples to illustrate the phrase, “participate, directly, or indirectly, in the conduct of the affairs of any insured credit union.”
Use the resource link to read more of CUNA’s comment on the NCUA proposal.