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Inside Washington (03/29/2012)

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  • WASHINGTON (3/30/12)--Treasury Secretary Timothy Geithner was noncommittal Wednesday in endorsing legislation proposed by Sen. Richard Durbin (D-Ill.) that would allow borrowers to discharge private student loan debt in bankruptcy. Durbin's proposal would make it more difficult for financial institutions to collect on delinquent loans. Geithner, speaking during a Senate appropriations subcommittee hearing, told Durbin he shared his concern about the private student lending market, and said Treasury would be willing to work with him on a specific proposal (American Banker March 29). More than $1 trillion in student debt is currently outstanding, including more than $150 billion in private student loans, according to the Consumer Financial Protection Bureau. In 2005, bankruptcy laws changed to include private student loans as exempt from discharge in bankruptcy. Prior to that, only federal student loans were exempt …
  • WASHINGTON (3/30/12)--The number of new foreclosures initiated during the fourth quarter of 2011 decreased to 292,173--down 16% from the previous quarter, the Office of Comptroller of Currency (OCC) said Wednesday. The inventory of foreclosures in process also decreased to 1,272,287--down 4.1% from the previous quarter and 3.1% from a year earlier. The OCC Mortgage Metrics Report for the Fourth Quarter of 2011 showed delinquencies remained elevated, but declined from a year earlier. Mortgages that were 30 to 59 days delinquent were 3% of the total serviced portfolio at year end, and mortgages that were seriously delinquent were at 5% of the total portfolio …
  • WASHINGTON (3/30/12)--Consumer Financial Protection Bureau Director (CFPB) Richard Cordray said Wednesday a bill that would add the CFPB to the list of regulators to which financial institutions can provide confidential information without waiving attorney-client privilege could become law in May (American Banker March 29). The House passed the bill on Monday. Cordray, speaking before the U.S. Chamber of Commerce, said he was hopeful the Senate would pass the bill by Memorial Day …

Lawmakers help CUs launch annual effort to help sick kids

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WASHINGTON (3/30/12)--The annual Credit Union Cherry Blossom 10-Mile Run will again take over downtown Washington, D.C., this weekend, as around 15,000 runners make their way through the streets of the nation's capital, and the Credit Union National Association (CUNA) will support the race for the 11th-straight time.

Assistant Democratic Leader Rep. James Clyburn (D-S.C.) and Reps. Eleanor Holmes-Norton (D-D.C.), Rob Woodall (R-Ga.) and Steven Palazzo (R-Miss.) joined race organizers and representatives from Congressional FCU, Washington, D.C.; CUNA; PSCU Financial Services; Children's Miracle Network Hospitals, at a Thursday press conference to kick off the Credit Union Cherry Blossom Run.

Click to view larger image Members of Congress, including, from left, Reps. Steven Palazzo (R-Miss.), Rob Woodall (R-Ga.), and Eleanor Holmes-Norton (D-D.C.), joined Congressional FCU CEO Charles Mallon, right, and Patricia Jasper-Zellner, senior associate director of Children's Miracle Network Hospitals, to kick off 2012 Credit Union Cherry Blossom 10-Mile Run festivities at a Thursday Capitol Hill press conference. (CUNA Photo)

Speaker of the House John Boehner (R-Ohio), Democratic Whip Steny Hoyer (D-Md.), and Democratic Caucus Chairman John Larson (D-Conn.) are also among the more than 180 members of Congress that have joined Washington, D.C. Mayor Vincent Gray as honorary chairs of the run.

The 10-mile run and 5k run/walk event raises funds for Children's Miracle Network Hospitals. CUNA President/CEO Bill Cheney said the run "brings together credit unions from across the country in support of a great cause." The title sponsor, Credit Union Miracle Day Inc., is entering its 11th year of race sponsorship, and has raised more than $5 million since beginning its sponsorship of the race in 2002. The group is slated to sponsor the race through 2016.

This year's race will feature a competitive field, with last year's female champion Julliah Tinega and 2011 male runner-up Allan Kiprono among those running.

CUNA has again co-sponsored the "Capitol Hill Competition," a race-within-a-race for runners from congressional offices. This competition set a record this year, as nearly 1,000 runners are registered. Cheney said the record high participation is a testament to the competition's popularity on the Hill, and to the great competitive spirit of the race.

T-shirts for participants in the 2012 Credit Union Cherry Blossom 10-Mile Run await pickup. (CUNA Photo)
A group of CUNA volunteers will again work the race bag check tent, where runners will store their belongings while they race. "It's an honor each year to help out the race in this way each year," Cheney said. CUNA employees are also taking part in the day's festivities by either running or walking the 10-mile or 5k routes.

In addition, two Credit Union FREEDOM Ten Mile Runs have also been planned, with one taking place on Saturday at the U.S. Army Garrison in Wiesbaden, Germany, and another scheduled for Sunday in Camp Arifjan in Kuwait. The Germany-based FREEDOM Run is the first at that location, and 350 runners are expected to take part.The Camp Arifjan run drew 470 runners last year.

Cordray delivers CFPB semiannual report to House committee

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WASHINGTON (3/30/12)--Saying his agency is "already taking important steps to improve the lives of consumers," Consumer Financial Protection Bureau (CFPB) Director Richard Cordray delivered the agency's first semiannual report to members of the House Financial Services Committee on Thursday.

Cordray discussed the same report, which was released in late January, with members of the Senate Banking Committee earlier this year.

In his testimony, Cordray said he is "driven by the challenges and responsibilities" of his agency's mission to protect American consumers, and added that he welcomed the members' thoughts about the CFPB's work. Cordray also noted that this is the 15th time a CFPB representative has testified before the House or the Senate.

The general progress of the CFPB was again addressed during the hearing, and Cordray in a prepared statement said the agency would not set prices, limit the size of banks, or ban any specific financial products. However, the CFPB is working to ensure a level playing field for the various financial institutions that offer consumer finance products such as payday loans, prepaid debit cards, mortgages, and student loans, Cordray added.

While some committee members credited the CFPB for the fast pace of its work, including work on mortgage disclosure form changes and student lending issues, others said they still questioned the validity of Cordray's appointment, which was made by President Barack Obama over the winter recess. Rep. Shelly Moore Capito (R-W. Va.) said the nature of Cordray's appointment could lead to challenges to CFPB authority.

For the full CFPB report, use the resource link.

Fed FDIC nominees approved by Senate Banking Committee

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WASHINGTON (3/30/12)--The Senate Banking Committee Thursday approved five Obama administration nominees, including nominees for Federal Reserve and Federal Deposit Insurance Corp. positions.

The approved nominees are:

  • Fed Board of Governors nominees Jerome Powell and Jeremy Stein;
  • FDIC Board of Directors nominee Jeremiah Norton;
  • Office of Financial Research Director nominee Richard Berner; and
  • Troubled Asset Relief Program special inspector general nominee Christy Romero.
Committee chairman Tim Johnson (D-S.D.) said strong leadership is needed at these posts "to solidify our nation's economic recovery and to help prevent another financial crisis."

Johnson encouraged the full Senate to move quickly to consider and confirm the nominees. "They are qualified, they have the support of members in both parties, and there is no good reason to block their confirmation," he said.

President Barack Obama's recent National Credit Union Administration (NCUA) Board nominee, D.C. Government Employee's FCU President/CEO Carla León-Decker, withdrew her name from consideration earlier this year. León-Decker would have replaced Gigi Hyland, whose six-year term on the NCUA board ended in August, if confirmed.