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Inside Washington (07/11/2011)

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* WASHINGTON (7/12/11)--Sheila C. Bair, who officially stepped down as chairman of the Federal Deposit Insurance Corp. on Friday, will join the Pew Charitable Trusts as a senior advisor Sept. 7. Pew Charitable Trusts studies and promotes nonpartisan policy solutions for problems affecting the American public and the global community. The Pew Research Center, a Washington-based subsidiary of the trusts, uses impartial, fact-based public-opinion polling and other research tools to track issues and trends … * WASHINGTON (7/12/11)--Stephen A. Quick has been named the Federal Deposit Insurance Corp.’s first chief risk officer. Since 2000, Quick has been director of the office of evaluation and oversight at the Inter-American Development Bank, a $100 billion multilateral finance institution. In that role, he was responsible for oversight of policies, systems, processes and institutional arrangements that affect the bank’s ability to accomplish its mission. His principal focus was on the management and mitigation of operational, reputational, fiduciary and mission risks. From 1993 to 2000, Quick served as manager of strategic planning and budget at the Inter-American Development Bank … * WASHINGTON (7/12/11)--David W. Wilcox has been named the Federal Reserve Board’s director of the Division of Research and Statistics, effective Oct. 1. Wilcox, currently the deputy director of the division, will succeed David J. Stockton, who will retire on Sept. 30 after 30 years of service with the board, including 11 as division director. In his new position, Wilcox will oversee the work of 325 employees and will be responsible for briefing the Federal Open Market Committee on the outlook for the U.S. economy. The board's Division of Research and Statistics does economic analysis, forecasting, and research related to the domestic economy and financial markets …

iCompBlogi blasts compliance myths and more

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WASHINGTON (7/12/11)—The Credit Union National Association’s (CUNA) compliance bloggers, swayed by popular demand, posted Compliance Myths Part II on CUNA’s new CompBlog when readers clamored for more after the first “myths” posting. “We received great reader feedback on the first ‘episode’ and we wanted to share more compliance un-truths that travel through the compliance grapevine,” said Valerie Moss, CUNA’s director of compliance information. And to make access to the CompBlog even easier for first-time users in CUNA-affiliated credit unions, CUNA has added the CompBlog icon—or “button”--on CUNA’s homepage alongside the access buttons already provided to CUNAverse, Facebook, and more. “Three myths that kept popping up in the many comments we received on our first myths’ post (6/24/11) are featured in this edition. They include the mistaken beliefs that: Reg B prohibits lenders from maintaining photocopies of drivers’ licenses in the loan file; federal credit unions can’t be closed more than three consecutive days at a time (a holiday favorite myth); and that most credit union regulations contain annual training requirements. “We explode each of these compliance myths in detail in the July 8 post,” said Moss. “And further editions of ‘Compliance Myths’ will be based on the feedback we receive from our readers. So let us hear from you,” she added. Moss added that readers are providing positive feedback to a number of recent posts including CUNA staff insights on the compliance implications of the new interchange rules and the controversy surrounding the proposed definition of a “qualified residential mortgage” (QRM). “Credit unions will also want to check out what we posted just last night about federal agency focus on member complaints,” noted Moss. “And remember that the CompBlog continues to post items previously found in CUNA’s “What’s New” daily compiliation.” Access the new CompBlog by clicking on CUNA’s CompBlog icon at the bottom of CUNA’s home page at

Prepay plan deadline hard and fast reminds Matz in webinar

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ALEXANDRIA, Va. (7/12/11)--National Credit Union Association (NCUA)Chairman Debbie Matz and some of her senior staff fielded questions from credit unions regarding the agency’s plan to allow credit unions to prepay some of their Temporary Corporate Credit Union Stabilization Fund (TCCUSF)assessments in a webinar Monday. CUNA President/CEO Bill Cheney has encouraged credit unions to consider the extent to which the program will benefit them and the credit union system. Among the questions credit union participants in the webinar raised was why is the program limited to $500 million. Agency staff responded that if the program were substantially larger, the agency would not be able to provide a dollar-for-dollar reduction in the assessment for this year, as it has committed to do. Or, if there is a larger prepaid assessment this year, there would be much larger assessments in 2013 and 2014, compared to the estimated assessments for those years that already are expected to increase as a result of the $500 million ceiling on the size of the program. Another participant asked why the 2013 and 2014 assessments will be larger under the program than for subsequent years. NCUA staff responded that the $500 million in prepaid assessments that will be used to reduce the regular assessment this year is coming from the assessments in 2013 and 2014, $250 million in each year. The Larger assessments in 2013 and 2014 will be needed to offset the fund’s cash flow needs in those years, since the prepaid assessment draws funds from credit unions that would have otherwise gone to the 2013 and 2014 assessments. It also was asked whether the Central Liquidity Facility could be used to lend funds to the stabilization fund to minimize the need for assessments from credit unions. NCUA staff said such a loan to the TCCUSF is not an allowable use of the CLF’s funds. In response to another question about what to reflect on call reports regarding the assessments, NCUA staff said nothing should be reflected on the June 30 report. Any prepaid assessment and the regular assessment would be reflected on the September call report. July 29 is a “hard and fast” date, and credit unions should notify the NCUA by that time whether they intend to participate, the agency said on the webinar. The program, first proposed in May, has the potential to decrease the currently projected 2011 Stabilization Fund assessment by 6.4 basis points (BP), from 24.9 bp to 18.5 bp, based on the March 31 level of total insured shares, according to the NCUA. Credit unions that wish to take part may pledge a minimum of $1,000 or 5bp of insured shares, whichever is greater. The maximum that can be contributed is 48 bp of those shares. The agency will not move forward with the plan if less than $500 million is pledged by credit unions by the July 29 date. Matz, during the webinar, reiterated that the NCUA has committed to use all received funds to decrease the 2011 assessment. The agency will tally the total amount of credit union commitments on Aug. 9, and, if it moves forward with the plan, will debit the amounts that have been pledged from credit union accounts on Aug. 18. In addition to the agency chairman, the following NCUA staff participated in the webinar presentation: Deputy Executive Director Larry Fazio, Examination and Insurance Director Melinda Love, and Chief Economist John Worth. This webinar will be archived on the NCUA website approximately two weeks after the event for those who cannot participate in the live session. As reported Monday in News Now, the Credit Union National Association has released a comprehensive white paper that will help its member credit unions assess whether or not they should take part in the corporate assessment prepayment plan. The white paper notes that the prepayment plan's financial benefits may not be broadly felt, but could prove vital for some credit unions. Use the resource link below to access the CUNA white paper (members only).

Webinar to address QRM problems for CUs

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WASHINGTON (7/12/11)--Credit unions and other interested parties have until Aug. 1 to comment on Qualified Residential Mortgage (QRM) rules and CUNA Mutual Group will host a webinar on July 18 to outline issues that most affect credit unions. The Credit Union National Association (CUNA) has voiced concerns that part of the QRM rules could have serious negative impact on credit unions and their members. As required by the Dodd-Frank Wall Street Reform Act, federal regulators are working on rules to define what mortgages are exempt from new risk-retention requirements and therefore will be designated as Qualified Residential Mortgages. These proposed rules were released in draft form for public comment earlier this year. Currently very restrictive in their language, the rules as drafted could limit many consumers’ eligibility for home loans and reduce the ability of credit unions and other smaller lenders to compete against large financial institutions. The webinar, scheduled for 2 p.m. (ET), will feature a panel of industry professionals discussing the proposed rules and the related risk-retention requirements, as well as the potential impact on the credit union mortgage lending business and members’ opportunities for homeownership. Webinar presenters include:
* Mary Dunn, CUNA senior vice president, and deputy general counsel; * Joel Luebkeman, director, marketing and product development, CMG MI; * Steve Robertson, managing director, PricewaterhouseCoopers; and * John McKechnie, senior vice president, Total Spectrum, and former director of the National Credit Union Administration’s public and congressional affairs office.
The webinar will be moderated by Christopher Roe, CUNA Mutual senior vice president of corporate and legislative affairs. Use the resource links below to register for the webinar or to file a comment on the proposed QRM rules with the Office of the Comptroller of the Current.

In Congress NFIP action GSE mark ups

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WASHINGTON (7/12/11)--The U.S. House and Senate returned to session yesterday and while lawmaker attention will be dominated this week by budget negotiations, there are other matters of credit union interest on the agenda--such as discussion of a possible five-year extension of the National Flood Insurance Program (NFIP). Today the House will consider Rep. Judy Biggert’s (R-Ill.) bill (H.R. 1039) intended to reform and extend the national flood insurance program. Congress must approve an extension or NFIP will expire Sept. 30, under the terms of its latest temporary extension. On the committee level, the highlight of committee activity this week will be the semi-annual monetary policy report to Congress delivered by Chairman Ben Bernanke of the Federal Reserve Board of Governors, which will take place on Wednesday before the House Financial Services Committee and Thursday before the Senate Banking Committee. Also of interest:
* The House Financial Service subcommittee on capital markets and government-sponsored enterprises has scheduled a markup for today on several bills related to Fannie Mae and Freddie Mac. During this mark-up, the subcommittee is expected to consider the following bills: Fannie Mae and Freddie Mac Transparency Act (H.R. 463); The Fannie Mae and Freddie Mac Taxpayer Payback Act (H.R. 2436); The Housing Trust Fund Elimination Act (H.R. 2441); The Market Transparency and Taxpayer Protection Act (H.R. 2440); Cap the GSE Bailout Act (H.R. 2462); Eliminate the GSE Charter During Receivership (H.R. 2439); and The GSE Legal Fee Reduction Act (H.R. 2428); * On Wednesday, the House Financial Services subcommittee on insurance, housing and community opportunity is scheduled to conduct a hearing on “Mortgage Origination: The Impact of Recent Changes on Homeowners and Businesses”; * For Thursday, the House Oversight and Government Reform Committee has scheduled a hearing entitled, “Consumer Financial Protection Efforts: Answers Needed.” Elizabeth Warren, assistant to the president and special adviserr to the Secretary of the Treasury, is the sole witness; * Also for Thursday, the House Financial Services subcommittee on oversight and investigations has scheduled a hearing on “Oversight of the Office of Financial Research and the Financial Stability Oversight Council.”