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Seek CU input WOCCU urges G-20 nations
MADISON, Wis. (9/24/09)--As finance ministers from the Group of 20 (G-20) nations prepare for this week's summit in Pittsburgh, World Council of Credit Unions' (WOCCU) leadership hopes the gathering will consider credit unions’ point of view more than it has in the past. Despite success in reaching other international regulatory bodies, WOCCU does not feel the G-20 has effectively used input from the global financial cooperative movement, according to a letter from Pete Crear, WOCCU president/CEO, to the G-20 leaders. “While we recognized the need for the G-20 governments to act rapidly over the past year, we have been disappointed by the lack of consultation in the process,” Crear wrote. “We hope that greater consultation with all parts of the financial sector will occur as the reform process continues.” This week's G-20 Summit in Pittsburgh, a location chosen by President Barack Obama because of the area's strong economic recovery, will review the progress made since the Washington D.C. Summit in November 2008 and London Summit in April. Plans include outlining further actions to assure a sound and sustainable recovery from the global economic crisis. Crear's letter commented on several areas that will be discussed by summit attendees, the finance ministers and central bank governors of 19 nations and the European Union. WOCCU said it largely applauds and supports the G-20 efforts to date, particularly as they relate to capital adequacy, liquidity needs and executive compensation. The organization hopes that greater distinction will be made between large, complex international banks and retail cooperative financial institutions in designing new guidelines, Crear’s letter said. “We agree that retained earnings should be the cornerstone of capital bases,“ Crear wrote, “but the rules for non-joint stock firms, such as financial cooperatives, must also recognize the importance of access to additional forms of capital.” Crear urged the G-20 ministers to support improved access to liquidity, clearing and settlement systems for credit unions in both developed and developing countries. Also, financial institution executive compensation should be tied to meeting long-term performance goals in an effort to assure that consumers’ well being is not compromised by bankers in pursuit of pay bonuses, he added. “Finally, as the implementation of regulatory reforms proceeds, we favor a gradual process to allow sufficient time for changes to be communicated,” Crear wrote. “This will help organizations and institutions work through the ongoing aftermath of the economic crisis.” The G-20 is an informal forum that promotes discussion among industrial and emerging-market countries on issues related to global economic stability. The G-20 includes Argentina, Australia, Brazil, Canada, China, France, Germany, Great Britain, India, Indonesia, Italy, Japan, Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the U.S. and the European Union. In G-20 countries, financial cooperatives serve 637 million people and have more than $9 trillion in assets.
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