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Washington Archive

Washington

Busy Senate could see vote on key bills

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WASHINGTON (7/13/10)—The U.S. Congress returned to session this week after its Independence Day District Work Period, and the action credit unions will want to watch is mostly concentrated in a busy Senate schedule. The Senate, reconvening yesterday afternoon to take up judicial nominations, also has on its agenda a final vote on H.R. 4173, the Wall Street Reform and Consumer Protection Act, and a vote on the Small Business Lending Fund Act (H.R. 5297). Each bill has its hot-button topic for credit unions. H.R. 4173, the comprehensive financial regulatory reform package, includes a provision requiring government price setting for interchange fees, which is strongly opposed by the Credit Union national Association (CUNA). And Sen. Mark Udall (D-Colo.) has introduced an amendment for The Small Business Lending Fund Act that would increase the credit union member business lending (MBL) cap to 27.5% of total assets, up from the current 12.25%. CUNA President/CEO Bill Cheney has underscored the urgency of continued credit union grassroots action on both bills. Cheney urges credit unions to continue to encourage their senators to back the increased MBL cap. He also urges continued opposition to the interchange provision, the inclusion of which in the regulatory reform bill has forced CUNA’s opposition to the package. Also on the Senate agenda this week is a vote on a supplemental appropriations bill, so while a vote is expected on H.R. 4173 late this week, it is also possible—and perhaps likely—that the Senate will not complete action on all of these bills this week. And a hearing of note this week: the Senate Banking Committee will conduct a nomination hearing for Janet Yellen to be a member and vice chair of the Federal Reserve Board, as well as for Peter Diamond and Sarah Bloom Raskin to be members of the Fed Board. The House has a lighter schedule this week. Of interest to credit unions:
* Consideration of the Flood Insurance Reform Priorities Act (H.R. 5114), which, as the name implies, would re-order the priorities of the program, and also provide a five-year extension of the National Flood Insurance Program. The programs most recent temporary extension lapses on Sept. 30.

FinCEN says reporting change brought CTR filing decrease

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VIENNA, Va, (7/13/10)—A new report describes the impact of a new Bank Secrecy Act (BSA) rule that was intended to simplify the process by which credit unions and other financial institutions can exempt the transactions of certain accountholders from a requirement to report transactions in currency in excess of $10,000. The Financial Crimes Enforcement Network (FinCEN) says in its new report that the rule, which went into effect 18 months ago on Jan. 5, 2009, has had a positive impact on reducing the cost of the exemption process to depository institutions by eliminating the need to file “designation of exempt persons,” or DOEP, for certain members or customers. FinCEN also claims the rule has enhanced the value and usefulness of the remaining currency transaction report (CTR) filings for law enforcement investigative purposes by removing filings that FinCEN says had little or no value to that effort. The changes to the filing rule, FinCEN said, resulted 12% drop in CTRs in 2009, to 13.7 million, and in a 44% drop in the number of exemption filings—to an all-time low of 29,000. FinCEN said CTR filings declined by 13.6% at the smallest institutions and by 20% at the largest ones. Use the resource link below to read more.

Inside Washington (07/12/2010)

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* WASHINGTON (7/13/10)--The Federal Housing Finance Agency (FHFA) is proposing a regulation that would create a new framework for conservatorship and receivership operations for the Federal National Mortgage Association, the Federal Home Loan Mortgage Corp., and the Federal Home Loan Banks, as contemplated by the Housing and Economic Recovery Act of 2008, according to a document published in The Federal Register (July 9). The proposed rule will implement the provision, Authority over Critically Undercapitalized Regulated Entities, and is designed to ensure that the conservatorship and receivership operations advance FHFA’s critical safety and soundness and mission requirements. The rule also seeks to protect the public interest in increasing the transparency of conservatorship and receivership operations for Fannie Mae and Freddie Mac ... * WASHINGTON (7/13/10)--The Federal Deposit Insurance Corp. (FDIC) board voted Monday to revise a memorandum of understanding with primary federal banking regulators to enhance FDIC’s existing backup authorities over insured depository institutions the FDIC does not directly supervise. The agreement will improve FDIC’s ability to access information to understand its exposure to insured depository institutions. Specifically, the memorandum gives FDIC backup supervision authority under an expanded list of circumstances, including when the insurance pricing system suggests an insured depository institution might be at higher risk, when institutions are defined as “large” under international regulatory guidelines or when large, interconnected bank holding companies are defined as systemic by financial reform legislation pending in Congress ...

NEW NCUA strongly endorses increased MBL authority

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ALEXANDRIA, Va. (UPDATE 7/13/10, 11:15 a.m ET)—The National Credit Union Administration (NCUA) today urged the U.S. Congress to pass a zero-cost “stimulus for America’s small businesses” by increasing the statutory limit on credit union member business lending. “There has never been a better time, or a better opportunity, to move the economy forward," said Chairman Debbie Matz in a release. “Congress now has an opportunity to increase the ability of credit unions to lend to small businesses, and in doing so empower credit union members to create more jobs and spur economic growth. “Credit union member business lending, when done in a safe and prudent manner that includes appropriate regulatory safeguards, can be of significant benefit to a small business community that is too often limited in their access to credit,” Matz said in her call to action on MBL legislation. The U.S. Senate is expected to resume work today on the Small Business Lending Fund Act (H.R. 5297) and begin voting on possible amendments. Sen. Mark Udall (D-Colo.) has introduced an amendment to increase the credit union MBL cap to 27.5% of total assets, up from the current 12.25%. The Credit Union National Association (CUNA) and credit unions have led a sustained grassroots push for MBL legislation, and have amplified their efforts to garner bipartisan support for the Udall provision in advance of a vote. H.R. 5297 is the bill that would allocate $30 billion for community banks to try to stimulate increase lending by those institutions to small businesses. CUNA has underscored that an MBL increase would carry no cost to taxpayers, but could infuse $10 billion of credit into small business and create more than 100,000 jobs.