Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

Washington
Inside Washington (10/29/2009)
* WASHINGTON (10/30/09)--The Federal Reserve Bank will likely benefit the most from a bill introduced by House Financial Services Committee Chairman Barney Frank (D-Mass.) that addresses systemic risk. The bill would give the Fed the ability to overrule regulators, break up firms and force undercapitalized companies into involuntary bankruptcy (American Banker Oct. 29). The committee scheduled a hearing for Thursday on the role of the Fed. Banking regulators and Treasury Secretary Timothy Geithner are slated to testify. The Credit Union National Association (CUNA) has said that Frank’s bill will likely not affect credit unions. Credit unions don’t pose a systemic threat to the overall financial system, CUNA said ... * WASHINGTON (10/30/09)--Banks have commented that they would rather pre-pay their assessments over the next few years to boost the Deposit Insurance Fund (DIF) instead of paying another special assessment. The Federal Deposit Insurance Corp. (FDIC) has proposed the prepayment plan to beef up the DIF’s reserves (American Banker Oct. 29). The FDIC’s prepay proposal was released Sept. 29 and banks could comment on the plan until Wednesday. John Lund, chief financial officer of Rockville Bank, said the plan is the “least painful” of all options. Chris Scribner, vice president, Regions Financial Corp., said the prepayment is the “right step at this time.” The plan would allow the industry to be responsible for the DIF balance while minimizing the impact on lending at banks, he wrote in his letter. The American Bankers Association supports the proposal, but warned it would come with a cost, because some banks may not have the liquidity for the request ... * WASHINGTON (10/30/09)--Federal Deposit Insurance Corp. (FDIC) Chair Sheila Bair said U.S. financial companies should prepay into a fund that the government could use to help large failed banks. Bair spoke at a House Financial Services Committee hearing Thursday (Bloomberg.com Oct. 29). Congress should create a Financial Company Resolution Fund that would require institutions with more than $10 billion in assets to pay before a firm fails, she said. Investors in the failed companies also should absorb losses, she added. The fund is more beneficial than an ex-post funded system because it allows all large firms, instead of just the survivors, to pay the assessments. It also avoids a pro-cyclical nature of requiring payments after a systemic crisis, she said. House Financial Services Committee Chairman Barney Frank (D-Mass.) and the Treasury agreed on a compromise bill that would recover taxpayers’ costs in helping the failed companies ... * WASHINGTON (10/30/09)--The Federal Reserve Thursday was expected to complete its $300 billion Treasury purchase program while signs prevailed that the seven-month program stabilized the housing market and staved off increases in borrowing costs (Bloomberg.com Oct. 29). The benchmark 10-note, which determines the rates on corporate bonds and mortgages, never moved above 4% after the Fed bought the debt. The rates are less than a half percentage point more than the day before the program was announced in March. The U.S. sold $1.25 trillion in bonds and notes, which is more than double of those sold last year. George Goncalves, chief fixed-income rates strategies in New York at Cantor Fitzgerald LP, said the Fed’s purchases likely kept rates from rising faster in April through June, when 10-year notes were at 4% ...


RSS print
News Now LiveWire
St. Louis treasurer taps #creditunion to serve unbanked #NewsNow http://t.co/lWtcezJOej
13 hours ago
.@CUNAMutualGroup has committed $35K to @trustdotcoop over the next year to suppor the future of #creditunions.
14 hours ago
.@madison_mag gets the cooperative scoop from @SummitDoMore's @kimsponem http://t.co/RxSCeSegie
14 hours ago
.@VantageWestCU emeritus chairman Whittaker inducted into @DCUC_HQ Hall of Fame http://t.co/dpeP4ME49U
16 hours ago
Australian newspaper covers Gen Y tips from @ServusCU at @WOCCU conference http://t.co/xqmLfZVwaI
17 hours ago