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Hearing coming on credit card bill

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WASHINGTON (3/10/08)--The House Financial Services subcommittee on financial institutions and consumer credit announced Friday it will conduct a March 13 hearing on “The Credit Cardholders’ Bill of Rights: Providing New Protections for Consumers.” The bill was drafted by the subcommittee’s chairman, Rep. Carolyn Maloney (D-N.Y.), after a series of hearings and a roundtable forum discussion with credit card issuers, consumer groups, House Financial Services Chairman Barney Frank (D-Mass.), and Rep. Mike Castle (R-Del.) to discuss potential credit card reforms. The announcement noted the subcommittee will hear from witnesses representing consumers, legal and economic experts, and credit card industry.

CUNA urges Senate support for CURIA

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WASHINGTON (3/10/08)—The Senate can help credit unions continue their mission of serving working families, making needed services available to lower-income or underserved consumers, as well as help promote economic growth, by backing a Senate version of the Credit Union Regulatory Improvements Act (CURIA), the Credit Union National Association (CUNA) said in a letter to every U.S. Senator. At the CUNA Governmental Affairs Conference in Washington last week, Sen. Mary Landrieu announced she will introduce CURIA in the Senate. Her bill is expected to be identical to that introduced by Reps. Paul Kanjorski (D-Pa.) and Ed Royce (R-Calif.) in the House last March. That bill has a total of 145 official backers in the House, and more are expected to sign on soon, after credit union efforts to garner additional support during Capitol Hill visits made in conjunction with the CUNA GAC. Sen. Joseph Lieberman (I-Conn.) also used the GAC as his venue for announcing he will sign onto the bill as an original co-sponsor. CUNA President/CEO Dan Mica urged Senate support of the bill to “enable credit unions to serve the best interests of their members.” “Specifically, CURIA will modernize credit union capital standards to permit more efficient capital management while allowing more earnings to be returned to members in lower costs and expanded services. It will expand the ability of credit unions to make loans to finance their members’ local small businesses. “It will permit more credit unions to offer needed services in lower-income communities that are not adequately served by other depository institutions. And it will improve the quality of services to credit union members by updating or removing burdensome regulations,” Mica noted in the March 6 letter. Mica added that CUNA looks forward to working with the senators and their staffs “on this and other important legislation.”

GAC closes CURIA backers increase

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WASHINGTON (3/10/08)—Reps. Joe Wilson (R-S.C.) and Bill Pascrell (D-N.J.) added their official support to the Credit Union Regulatory Improvements Act (CURIA, H.R. 1537) just as the four-day Credit Union National Association Governmental Affairs Conference—complete with grassroots Hill visits--ended. The addition of the two names brings the total of official CURIA supporters in the House to 147. Credit union representatives from both South Carolina and New Jersey were among the hundreds flooding Capitol Hill to garner support for CURIA and other credit union issues. Also, it was at the CUNA GAC that Sen. Mary Landrieu unveiled her plan to introduce a Senate version or CURIA. The general visibility of the cornerstone credit union legislation was acutely heightened last week, between Landrieu’s announcement, the credit union Hill visits, and a comprehensive House Financial Services Committee hearing on credit union regulatory relief issues, which highlighted CURIA. Use the resource link below for CURIA details and a full list of co-sponsors.

House bill would address interchange fees

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WASHINGTON (3/10/08)—A bill on credit card interchange fees was introduced in the House last week. H.R. 5546 is intended to ensure competitive market-based rates and terms for merchant’s access to electronic payment systems by enabling merchants to negotiate on fees with card companies. The bill was introduced by Rep. John Conyers (D-Mich.), who is chairman of the House Judiciary Committee, and is called the “Credit Card Fair Fee Act of 2008.” At issue are the fees charged merchants by credit card companies each time a consumer uses the card for a purchase. In a release, Conyers said the fees increased 117% between 2001 and 2006 and an additional 17% between 2006 and 2007. The fees amounted to $42 billion in that one-year period. Some proponents of legislation argue that the regulation of such fees in other parts of the world have produced lower fees for merchants and have prevented further escalation of fees. Some argue that it is unfair to merchants—and ultimately their customers-- to pay what they say amounts to a hidden revenue stream to the credit card issuers. However, others counter the pro-regulation arguments saying that the free market should set the interchange fees, not the government. They credit interchange fees with assisting the growth of universal acceptance of cards and the innovation of super-fast authorization technology and enhanced security measures. ”This legislation is intended to give merchants a seat at the table in the determination of these fees,” he said. “The bill creates a limited antitrust immunity for negotiating voluntary agreements and, if necessary, participating in the market-based proceedings.” These market-based proceedings will determine the exclusive rates and terms merchants must pay for a three year term. No other fees, terms or conditions may be imposed on the merchants. Under the bill, the rates and terms would be determined by Electronic Payment System Judges, to be appointed by the Department of Justice Antitrust Division and the Federal Trade Commission. The Credit Union National Association and its payments subcommittee are currently reviewing the 45-page bill to determine the extent of its impact on credit unions.

Inside Washington (03/07/2008)

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* ALEXANDRIA, Va. (3/10/08)--The National Credit Union Administration’s Office of Small Credit Union Initiatives (OSCUI) joined other federal agency representatives last week to discuss financial education needs in African-American communities. The roundtable was the third in a series of four discussions held as part of the Financial Literacy and Education Commission's implementation of the National Strategy for Financial Literacy. Adrienne Munroe, of OSCUI, summarized NCUA's financial education programs, stressing that both NCUA and credit unions have historically been dedicated to bringing financial services to those with limited access to the financial mainstream… *WASHINGTON (3/10/08)—In a report to the Federal Deposit Insurance Corp.'s (FDIC) board of directors, the agency’s inspector general urged that a bank's commercial real estate (CRE) risk should be noted more prominently in exams. The inspector general said the FDIC should require more examination reports to include a specific page showing the level of CRE loan concentrations. The inspector general said the FDIC should require a specific page on the level of CRE loan concentrations in more examination reports (American Banker March 7)…