ALEXANDRIA, Va. (5/21/12)--The Wisconsin Office of Credit Unions liquidated Wausau Postal Employees CU of Wausau, Friday and appointed the National Credit Union Administration (NCUA) as liquidating agent.
The NCUA and CoVantage CU immediately signed an agreement for the Antigo, Wis., to purchase and assume Wausau Postal Employees' assets, liabilities, and membership.
The new CoVantage Credit Union members will experience no interruption in services and their accounts remain federally insured by the National Credit Union Share Insurance Fund up to $250,000.
CoVantage, afull-service, federally insured, state-chartered credit union, has $1 billion in assets and more than 74,000 members. CoVantage Credit Union serves the people who live or work in Wisconsin's Brown, Clark, Florence, Forest, Langlade, Lincoln, Marathon, Menominee, Oconto, Oneida, Outagamie, Portage, Shawano, Taylor, Waupaca, and Wood counties or in Michigan's Dickinson and Iron counties.
It was Wausau Postal Employees' declining financial condition that led to its closure and subsequent purchase and assumption, according to an NCUA announcement. At the time of liquidation, the credit union served 845 members and had $8.4 million in assets.
Chartered in 1932, Wausau Postal Employees Credit Union served all postal and federal employees and their families in the 544 and 545 zip codes.
Wausau Postal Employees CU is the fourth federally insured credit union liquidation in 2012.
- WASHINGTON (5/21/12)--Federal Deposit Insurance Corp. inspector general Jon Rymer will temporarily run the Securities and Exchange Commission's (SEC) inspector general office while the SEC seeks a permanent successor for H. David Kotz, its former IG, American Banker (May 18) reported Friday. Rymer is expected to oversee the IG responsibilities at both agencies concurrently until a permanent SEC watchdog is found, a source said. Kotz left the SEC in January after allegations of misconduct by the office surfaced. Last week, Sen. Chuck Grassley (R-Iowa) requested more information on the allegations. "The recent turmoil at the SEC inspector general's office raises questions about how well that office is functioning," Grassley said in a statement. "Information from all sides is necessary to try to establish where things went wrong and what the agency can do to refocus its watchdog capacity" …
- WASHINGTON (5/21/12)--The Senate Banking Committee on Thursday requested JPMorgan Chase CEO Jamie Dimon to testify under oath about the $2 billion trading loss his company suffered last week. Sen. Tim Johnson (D-S.D.) announced that Dimon would be called to testify during two hearings the committee will hold with key financial regulators to address Wall Street reform. "Our due diligence has made it clear that the Banking Committee should hear directly from JPMorgan Chase's CEO Jamie Dimon, and following our two Wall Street reform oversight hearings I plan to invite him to testify," Johnson said in a statement …
- WASHINGTON (5/21/12)--Sens. Jeff Merkley (D-Ore.) and Carl Levin (D-Mich.) Friday sent a letter to regulators calling on them to close the "JPMorgan Loophole." Although the Dodd-Frank Act prohibits banks from proprietary trading, the regulators' proposed rule creates a new loophole that could allow proprietary trading to continue even after the law goes into effect. The loophole would likely allow Wall Street banks to continue proprietary trading by calling it "portfolio hedging" even after the Volcker Rule is finally implemented, Merkley and Levin wrote. The letter was sent to the heads of the Federal Reserve, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corp., the Securities and Exchange Commission and the Commodity Futures Trading Commission. "So long as banks have the incentives to make these types of bets and are permitted to do so, they will," Merkley and Levin wrote. "As we have learned time and time again, establishing clear, strong rules of the road is critical for the healthy functioning of markets and our economy" …
- WASHINGTON (5/21/12)--The Senate confirmed Jeremy Stein and Jerome Powell to the Federal Reserve's Board of Governors Thursday after their nominations were delayed for months by Republicans who argued Stein and Powell would be too supportive of Chairman Ben Bernanke's economic policies. Senate Majority Leader Harry Reid (D-Nev.) used last week's news of JP Morgan Chase's $2 billion trading loss to compel the Senate to move forward with the vote and secure the required 60 votes (American Banker May 18). With the confirmations of Stein and Powell, for the first time in six years the Federal Reserve board is at full capacity. "Jay Powell and Jeremy Stein are ready to get to work, and I'm glad that my Senate colleagues set party politics aside and approved these individuals with strong bipartisan support," said Sen. Tim Johnson (D-S.D.), Senate Banking Committee chairman …
ALEXANDRIA, Va. (5/21.12)--The National Credit Union Administration (NCUA) announced that cease-and-desist orders have been filed against Francis Lee and Joseph Herbst, both formerly affiliated with U.S. Central FCU (U.S. Central) , located in Lenexa, Kan.
The orders were one of the terms of settlements between Lee and the NCUA and Herbst and the NCUA to settle potential claims against the men stemming from the conservatorship and eventual liquidation of U.S. Central.
Both Lee and Herbst consented to the order without admitting fault. The orders require Lee and Herbst to desist from the following actions:
- Becoming an employee of, holding any office in, or otherwise participating in any manner in the conduct of the affairs of any federally insured corporate credit union;
- Consulting or advising any federally insured corporate credit union on any matters involving or relating to investment securities, investment policy, or investment strategy; or
- Selling any investment securities to any federally insured corporate credit union.
NCUA enforcement orders are online at http://go.usa.gov/yiJ
and can be inspected atthe NCUA's Office of General Counsel between 9 a.m. and 4 p.m. Monday through Friday.
WASHINGTON (5/21/12)--The Government Accountability Office (GAO) has informed the National Credit Union Administration (NCUA) that the agency has satisfied GAO's recommendations that the NCUA Office of Inspector General (OIG) review the agency's loss estimates regarding the legacy assets of some of the corporate credit unions.
In a recent report, entitled "National Credit Union Administration: Earlier Actions Are Needed to Better Address Troubled Credit Unions (GAO-12-247)," the GAO had recommended that the NCUA provide its OIG supporting documentation that would verify the total losses incurred from Jan. 1, 2008 to June 30, 2011.
In a letter dated May 18, the GAO noted that the federal credit union regulator had, since that report, provided its OIG the supporting documentation on the loss estimates for the Corporate Credit Union Stabilization Fund and the NCUA 2010 Financial Statement Audit for Temporary Corporate Credit Union Stabilization Fund.
"Based on the documentation provided, the OIG has concluded the loss estimates are reasonable," GAO said in its letter.
WASHINGTON (5/21/12)--The Eliminate Privacy Notice Confusion Act (H.R. 5817), which is intended to cut the regulatory burden on credit unions and other financial institutions by limiting requirements on privacy notifications, was introduced on Friday and is strongly supported by the Credit Union National Association (CUNA).
The bill, which is sponsored by Rep. Blaine Leutkemeyer (R-Mo.) and cosponsored by Reps. Scott Garrett (R-N.J.) and Lynn Westmoreland (R-Ga.), states that financial institutions that provide nonpublic personal information only in accordance with the provisions of the Graham Leach Bliley Act, that do not share it with affiliates, and that have not changed their policy and practice since disclosing the policy, shall not be required to send annual privacy notifications to their members or customers.
The bill would also shield state-licensed credit unions and other financial institutions from Graham Leach Bliley disclosure requirements, provided their respective states have their own privacy regulations on the books.
CUNA President/CEO Bill Cheney commended Rep. Leutkemeyer for his leadership in introducing this regulatory relief measure. "The bill would eliminate a number of unnecessary and, quite frankly, confusing mailings that are often ignored by consumers and will reduce costs for credit unions and reduce confusion for credit union members," he added.
Cheney said CUNA looks forward to working with Rep. Leuktemeyer and the cosponsors to enact the bill.
A model privacy form, which was required by the Graham Leach Bliley Act, was developed jointly by the National Credit Union Administration and the Federal Reserve System, Commodity Futures Trading Commission, Federal Deposit Insurance Corporation, Federal Trade Commission, Office of the Comptroller of the Currency, Office of Thrift Supervision, and Securities and Exchange Commission in 2009.
WASHINGTON (5/21/12)--With members of the U.S. House returning to their home districts for the Memorial Day district work period during this week's National Small Business Week, Credit Union National Association (CUNA) Senior Vice President of Legislative Affairs Ryan Donovan said it is imperative that credit unions continue to communicate the help that they could lend to a still-recovering economy if member business lending cap increase legislation were enacted.
Two bills, S. 2231, and its House counterpart, H.R. 1418, would increase the MBL cap to 27.5% of a credit union's assets, up from 12.25%. Within the first year of enactment, the increased MBL authority would help to inject $13 billion in loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, CUNA estimates show.
Credit unions have pushed hard to garner congressional support for these two bills, and a vote on the Senate legislation could come at any time. Members of the Senate will leave Washington next week for their own district activities,
Most recently, credit union advocates from North Carolina and South Carolina, and credit union leagues from each of those states, made the case for an MBL increase in visits to Washington as part of CUNA's Hike the Hill activities.
And the North Carolina Credit Union League (NCCUL) has had more help in recent weeks, as the North Carolina Association of Realtors (NCAR) urged Sens. Kay Hagan (D) and Richard Burr (R ) to "take a stand for small businesses" and support S. 2231. "The failure of many North Carolina banks to finance construction projects has been a source of great concern for our organization and our members," the NCAR wrote.
NCCUL Senior Vice President of Association Services Dan Schline said the support of the North Carolina Realtors and the hundreds of small business owners from across the state continues to demonstrate that MBL cap increase legislation "has broad based support."
This broad-based support is also evident on the national level, as several pro-business, conservative, libertarian and free-market organizations have stepped up to support increasing the MBL cap this year.
Raleigh, N.C.-based community development nonprofit The Support Center showed the help that community development credit unions and other community development financial institutions have given to small businesses in that state in a recent report, which found that while large banks have been pulling back from small business lending, credit unions and other community-based lenders have been stepping in to try to fill the lending gap.
"These financial institutions serve low-income communities and provide loans to the small businesses that, in many cases, have been turned away from mainstream banks," but they need additional public and private support to keep small businesses afloat, the Support Center said.
For the full Support Center report, and more on how you can contact your legislators and urge them to support increased MBL authority for credit unions, use the resource links.