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Washington Archive

Washington

Inside Washington (05/28/2009)

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* WASHINGTON (5/29/09)--The Federal Reserve Board is not releasing details from regulatory reports that Discover Financial Services filed during the first quarter (American Banker May 28). Discover--a bank holding company as of December--told the Fed it will include information in its filing that is not already public. The Fed said in a letter May 19 that it would grant Discover confidentiality treatment regarding the card company’s first-quarter financials report. The Fed has taken similar actions with GMAC ... * WASHINGTON (5/29/09)--Treasury Secretary Tim Geithner Wednesday announced $1.5 billion in New Markets Tax Credit (NMTC) awards for 32 organizations. Among the recipients are JPMorgan Chase and Co. and Capital One Financial Corp. The NMTC Program injects private-sector capital investment into communities to create jobs, stimulate economic growth and jumpstart the lending necessary for financial stability. The NMTC Program, established by Congress in December 2000, permits individual and corporate taxpayers to receive a credit against federal income taxes for making qualified equity investments in Community Development Entities ...

Remittance GSEs future are hearing topics

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WASHINGTON (5/29/09)—House Financial Service subcommittees will soon begin discussions on a pair of issues of importance to credit unions, with hearings scheduled for Wednesday, June 3. The first hearing, entitled "Remittances: Regulation and Disclosure in a New Economic Environment," will be held before the House subcommittee on financial institutions and consumer credit at 10 a.m. IRNet, a remittance service created by a World Council of Credit Unions (WOCCU)-related services group in 2001, currently serves 109 U.S. credit unions and has facilitated the transfer of $80 million in 148,000 separate remittance transactions between credit unions in the U.S. and foreign nations. WOCCU last week predicted that the total number of remittances to the Caribbean and Latin America would likely decline in 2009 due to the global economic downturn. (See related May 21 story: Expect decline in remittances for 2009.) A second hearing, scheduled by the House subcommittee on capital markets, insurance, and government-sponsored enterprises, will discuss the current and future condition of government-backed mortgage lenders Fannie Mae and Freddie Mac. The hearing will take place in the Rayburn House Office Building at 2 p.m. Witness lists for both hearings were not available to the public at press time.

CUNA Would account date improve credit reports

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WASHINGTON (5/29/09)—Tucked into recently approved final rules to improve the accuracy of consumer credit reports, federal financial regulators included guidelines on developing procedures to ensure the integrity of information provided to credit bureaus. The regulators seek comment on those guidelines. The final rules were developed under the Fair and Accurate Credit Transactions (FACT) Act, which also required the National Credit Union Administration (NCUA), the other federal financial institution regulators, and the Federal Trade Commission to issue policy and procedure guidelines. The Credit Union National Association (CUNA) is asking credit unions to comment on the agencies’ advance notice of proposed rulemaking (ANPR) on the guidelines. The ANPR specifically requests comment on whether furnishers of consumer information should provide to credit bureaus the date that an account is opened in order to promote the integrity of the information since this may indicate a long-standing credit history, which may result in a higher credit score for the consumer. The ANPR also requests whether comment on what other information should be provided as a means to ensure the integrity of the credit information. Comments are due to CUNA by July 20. Use the resource link below to read CUNA’s complete Comment Call.

New CU reporting regs should treat training security concerns

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WASHINGTON (5/29/09)—Although the Credit Union National Association (CUNA) supports the gains in efficiency, accuracy, and security that the National Credit Union Administration’s (NCUA) plan to modernize the credit union reporting system intends to create, CUNA has asked the NCUA to ensure that any potential deficiencies in software or personnel training will be addressed. In a recent comment letter, CUNA said that NCUA should grant credit unions the time needed to sufficiently train their employees on how to best use the new system, which will require federally-backed credit unions to submit their reports and other information to NCUA over the internet. According to NCUA’s proposed adoption schedule, natural person credit unions will adopt the new system during the third quarter of this year, with corporate credit unions set to adopt sometime in 2010. NCUA should also provide technical support, even if that support is only available during the early implementation stages of the new program. CUNA also supports NCUA policies that would ensure that the sensitive information held by federally-insured credit unions is properly secured throughout the reporting process. Use the resource link below to access the complete CUNA comment letter.

CUNA issues comment call for new SBA rules

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WASHINGTON (5/29/09)—The Credit Union National Association (CUNA) has issued a regulatory comment call on the U.S. Small Business Administration's (SBA) proposal to change the size criteria of businesses eligible for the SBA’s 7(a) guaranteed business loan program. The revised rule would extend 7(a) loans to small businesses with a net worth of $8.5 million or less, a move that could grant eligibility to as many as 70,000 additional small businesses. The changed standard would only apply until Sept. 30, 2010. CUNA is asking for industry comment on whether or not credit unions support this changed size requirement and if the changed rules should be extended beyond September 2010. Comments are due to CUNA by July 22. For more information, use the link.

Adjusted ROA shows slightly negative results

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ALEXANDRIA, Va. (5/29/09) The National Credit Union Administration (NCUA) issued an adjusted first-quarter credit union financial report Thursday that shows the return on average assets (ROA)—with corporate credit union stabilization expenses factored out—would be very slightly negative at 0.01 %. The revised release clarifies that when federally insured credit unions’ National Credit Union Share Insurance Fund (NCUSIF) costs associated with corporate stabilization expenses are taken out, the return on average assets would be negative 0.01%. The NCUA said it considers the revised ROA figure “indicative of credit union performance.” Provisions within the Helping Families Save Their Homes Act, signed into law May 21, allow credit unions to spread the cost of NCUSIF replenishment over a longer period of time, with a total of eight years to deal with the cost of a premium assessment that has resulted from losses at wholesale corporate credit unions. Any impairment related to the NCUSIF replenishment may be booked over a seven-year period.