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Mica on Fox Time to show slivers of good news

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WASHINGTON (3/18/09)—Credit Union National Association (CUNA) President/CEO Dan Mica appeared on Fox Business Network Tuesday in advance of a Federal Open Market Committee (FOMC) announcement on rates and said it’s time for that body to share any available good economic news. The Federal Reserve Board’s 12-member FOMC yesterday began a two-day meeting, one of eight regularly scheduled each year. The committee reviews economic and financial conditions, determines the appropriate stance of monetary policy, and assesses risks to its long-term goals of price stability and sustainable economic growth.
Click for videoCUNA President/CEO Dan Mica on Fox Business Network Tuesday. Click for member-only video. (Photo provided by CUNA)
In the television interview, Mica said that because of the psychological impact it could have, what the FOMC says may be as important as what it does. Mica said that when it comes to policy or psychology, the Fed and its FOMC should start targeting public attention on even “slivers” of good economic news. He noted, for instance, that in his home state of Florida, some counties are showing a stabilization in their housing markets. “There are slivers of good economic news showing up,” Mica underscored. Also appearing on the business program, Paul Bilou, a former Fed economist and now senior vice president of Nationwide, referred to the slivers as “green shoots,” a phrase Fed Chairman Ben Bernanke has used. He also said the FOMC will “send a message” and “provide confirmation over whether or not they see more green shoots sprouting up.”

Feds should encourage transparent reg review CUNA

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WASHINGTON (3/18/09)—The federal government should encourage broader public participation in the regulatory review process by improving its system for receiving, reviewing, and responding to comments regarding specific agency rulemakings or guidance documents, the Credit Union National Association (CUNA) said recently. CUNA said the current system of review performed by the Office of Management and Budget (OMB) and the Office of Information and Regulatory Affairs (OIRA) frustrates public participation. A formal comment procedure should be adopted and OIRA review should be expanded to cover more agencies within the executive branch, such as the Internal Revenue Service (IRS). CUNA also recommended that OIRA’s capacity should be increased so that its ability to review administrative issuances in a critical manner is commensurate with its agency mission. The comments were made in letters to OMB and OIRA on President Barack Obama’s potential new executive order regarding regulatory review of administrative rulemakings and guidance by the two agencies. CUNA told the agencies of its own frustrations with the current system as it has applied to efforts to express concerns about “specific, seriously deficient issuances under review.” For example, CUNA cited a 2007 request to OIRA to review several IRS informal guidance issuances in the form of Technical Advice Memoranda (TAMs). They addressed state-chartered credit union Unrelated Business Income Taxation (UBIT) liability. OMB informed CUNA that IRS guidance is exempt from OIRA review. Although the credit union industry had requested that IRS issue comprehensive, formal guidance in the form of a revenue ruling, IRS ultimately opted for the informal, case-by-case guidance in the form of TAMs. The tax agency’s approach, CUNA said, has resulted in an arbitrary and extremely restrictive view of credit unions’ exempt purpose that threatens to upset the dual federal and state chartering system for credit unions and is negatively impacting the U.S. credit markets. The IRS’s use of TAMs to expand credit union taxation, CUNA wrote, is just one example of a major policy decision that has been decided without centralized review or meaningful public participation. A centralized OIRA review of administrative issuances and a formal process for public participation is paramount because major policy decisions, such as expansion of credit union UBIT liability, should be made in a manner that is consistent with the Administration’s priorities, CUNA urged.

CUNA loan mod. seminar open now for sign up

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WASHINGTON (3/18/09)—Registration information is now available to credit unions interested in signing up for an April 2 audio conference call featuring the latest information on the Obama administration's loan modification and refinance program. The audio conference, offered by the Credit Union National Association (CUNA), will address Obama’s "Making Home Affordable Refinance and Modification Program," which is designed to help up to 9 million families refinance their existing mortgages or modify their current loans to stave off foreclosure. Under the loan modification plan, borrowers may be offered rate reductions to as low as 2%, have their loan term extended to up to 40 years, and possibly receive forbearance or a reduction in principal. Incentives are provided by the government for lenders, servicers, and borrowers to participate. Under the refinancing provisions, for loans owned or securitized by Freddie Mac and Fannie Mae, borrowers may refinance loans with balances up to 105% of the value of their house, up from the current limit of 80%. During the CUNA audio conference, participants will:
* Hear about the structure and requirements of this new program from the agency experts; * Explore the loan refinance program to understand how borrowers can refinance if a loan exceeds current market value of the home; * Examine the loan modification option and how it’s geared towards members who are behind or are struggling to make mortgage loan payments; and * Learn the requirements of each program, which members qualify, and the benefits to both the credit union and its members for participating in the program.
Key speakers will include Laurie Maggiano, senior policy advisor for the U.S. Treasury Department's Office of Financial Stability, who will address issues surrounding the loan modification program. Speakers from Fannie Mae and Freddie Mac, to be announced soon, will address the refinance aspects of the administration program. The 90-minute audio conference is scheduled for 3:30 p.m. (ET). Use the resource link to register.

Inside Washington (03/17/2009)

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* WASHINGTON (3/18/09)—The Financial Crimes Enforcement Network, known as FinCEN, noted recently that mortgage fraud Suspicious Activity Reports (SARs) jumped 44% over twelve months ending June 30 of last year. FinCEN said there were 62,084 mortgage-fraud SAR filings during that period. (American Banker March 17) They accounted for 9% of total depository institution SARs. The timing of the SARs filing changed a little bit during that time period—it ticked up a bit to 34% being filed before a loan was granted, compared to 31% in the prior 12-month period… * WASHINGTON (3/18/09)—After a decline in the size and number of institutions being supervised in its western region, the Office of Thrift Supervision (OTS) has realigned its regional structure. The agency expanded its central region, based out of Chicago, to include thrift institutions in Minnesota, Iowa, Nebraska, North Dakota and South Dakota. All thrifts in the OTS’ West region, and many in the Midwest region, will form the basis of the new Western region, headquartered in Dallas (American Banker March 17)…