Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive
150x172_CUEffect.jpg
Contacts
LISA MCCUEVICE PRESIDENT OF COMMUNICATIONS
EDITOR-IN-CHIEF
MICHELLE WILLITSManaging Editor
RON JOOSSASSISTANT EDITOR
ALEX MCVEIGHSTAFF NEWSWRITER
TOM SAKASHSTAFF NEWSWRITER

Washington Archive

Washington

Administrations Finance Council announces first meeting

 Permanent link
WASHINGTON (11/8/10)—President Barack Obama's Advisory Council on Financial Capability will hold its first meeting on Nov. 30. Defense Credit Union Council President/CEO Arty Arteaga is among those taking part in the meeting. The group, according to an Administration release, is comprised of two ex officio Federal officials and an additional 11 non-governmental members with experience in the areas of financial services, consumer protection, financial access, and education. The group has been tasked with promoting and enhancing “individuals' and families' financial capability,” according to the release. “Organizational matters and strategic areas of focus” will be the focus of this first meeting, the release added. The meeting will be open to members of the general public.

CUNAs McLain covers mortgage payment disclosures

 Permanent link
WASHINGTON (11/8/10)--In a recent Credit Union Magazine column, Credit Union National Association (CUNA) Senior Compliance Counsel Mike McLain addressed the Federal Reserve’s interim rule that revises disclosure requirements for closed-end mortgages under its Regulation Z. According to McLain, the new Fed rule alters existing disclosure requirements by requiring disclosure of how mortgage payments can increase, decrease or otherwise change over time. Information on both the rates and various features of the loans must be disclosed. Specifically, initial interest rates, and the corresponding monthly cost of the mortgage payments, associated taxes and insurance costs, must be included. Variable rate loan disclosures must contain information on the potential maximum rate that the loan could take on in the first five years and over the lifetime of the loan. Features of the loans, including information on balloon payments or other payment options, must be included, and a disclosure stating that mortgageholders are not guaranteed the right to refinance their mortgages must also be packaged alongside the other statements. “The interim rule applies to all transactions secured by a dwelling (principle residence or second home) and transactions secured by real property that don’t include a dwelling or other structures. Timeshare plans aren’t covered,” McLain added. Overall, the format of the disclosures must be “substantially similar to the model forms and clauses that are provided with the rule,” McLain said. For more on the disclosures, see this month’s edition of Credit Union Magazine.

Corporate CU summit kicks off this week

 Permanent link
WASHINGTON (11/8/10)—The Credit Union National Association (CUNA) later this week will bring together several credit union stakeholders in an attempt to develop a systemwide plan for the future of corporate credit unions. The summit, which will take place in Chicago on Sat., Nov. 13, will be strictly about dialogue, and will not attempt to “force outcomes,” CUNA Vice President of Communications Pat Keefe said. The summit will attempt to address the future role of corporate credit unions in providing key payments, settlement, liquidity, and investment advisory services to natural person credit unions. Natural person and corporate credit union representatives, state credit union league leaders, and other related groups will be among the 80 individuals in attendance. CUNA President/CEO Bill Cheney last month noted that a large number of credit unions and others asked CUNA to lead the meeting and “help the industry chart a path to the future on these issues.” However, CUNA is not taking sole ownership of the issue, and plans to work closely with the credit union system to help address questions that have arisen since the National Credit Union Administration (NCUA) approved new corporate credit union and legacy asset rules on Sept. 23. "There are no more important issues now than how we, together, address corporate credit union services. This is why CUNA will be hosting the summit and continuing our work to pursue solutions not only for the transition period under the new rule but for the future," Cheney said. The NCUA in late September revealed its final corporate credit union rule, which adjusts the current corporate capital requirements by replacing the current 4% minimum total capital ratio with a 4% minimum leverage ratio, a 4% tier one risk-based capital ratio, and an 8% total risk-based capital ratio for adequately capitalized corporate credit unions. The new rule will also prohibit the purchase of private-label mortgage-backed securities or subordinated securities, and limit the awarding of so-called "golden parachute" executive compensation packages in some instances. The new rules also impose some restrictions on the board composition of corporate credit unions. The NCUA plans to release additional refinements to its corporate plan as they are developed.

Inside Washington (11/05/2010)

 Permanent link
* WASHINGTON (11/8/10)--The Federal Reserve Board is being unusually open about the Federal Open Markets Committee’s decision to buy $600 million in additional long-term securities. Federal Reserve Chairman Ben Bernanke authored an op-ed article that appeared this week in the The Washington Post to spell out what is being done and the reasons behind the Fed’s actions. Bernanke’s article continues the Federal Reserve’s shift toward greater disclosure of the factors that are weighed in its decisions along with its goals for the future (American Banker Nov. 5). Observers said Bernanke is moving toward transparency as a way to boost confidence and support the economic agenda. Bernanke’s op-ed article did not address how the move is likely to impact the dollar or how it reflects overall fiscal policy. The Federal Reserve has made monetary policy moves of this size only twice before, in 2008 and 2009 … * WASHINGTON (11/8/10)--Regulators and officials from large banks are discussing how to develop “living wills” that would make it easier for regulators to respond if another banking crisis occurs. The Dodd-Frank law requires banks with the potential for systemic impact on the financial system to develop “living wills” plans. The Federal Deposit Insurance Corp. (FDIC) this week continued its series of roundtables focusing on the information that would be needed to give regulators a blueprint for untangling bank subsidiaries from holding companies after a crisis. Another key issue is determining the extent of a firm’s systemic reach. The FDIC and the Federal Reserve Board are charged with developing joint guidelines for developing the plans (American Banker Nov. 5). The agencies are expected to offer their guidance in early 2011 …