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Gigi Hyland Named Executive Director Of the National CU Foundation

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WASHINGTON (7/15/13)--The National Credit Union Foundation has named Gigi Hyland as its new executive director, effective Aug. 26.
Hyland was most recently a member of the three-person National Credit Union Administration board, serving from 2005 until October 2012. "Gigi brings a wealth of credit union experience and an understanding of the non-profit sector that will serve the Foundation well," said National Credit Union Foundation Chairman Laida Garcia.
Prior to the NCUA, Hyland was senior vice president and general counsel of Empire Corporate FCU, now Members United Corporate FCU.
Hyland will operate from the Credit Union National Association's Washington, D.C. office, where she has worked previously. Hyland was CUNA's vice president of Corporate Credit Union Relations and executive director of the Association of Corporate Credit Unions from 1997 to 2002.
"I am excited about this opportunity and anxious to begin working with the great team and board that we have at the Foundation, as well as its many credit union supporters," said Hyland. "The Foundation is well-positioned to continue to be a leader in financial literacy and education, which has never been more important for consumers and remains as one of the core missions of the credit union system," Hyland said.
Hyland succeeds Bucky Sebastian, who recently announced his retirement.   

'Inside Exchange' Says CUs' Tax Message Hitting Its Mark

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WASHINGTON (7/15/13)--Calendar pages are turning quickly toward the July 26 deadline set by U.S. Congress tax policy leaders who want all suggestions for tax reform legislation by that date. The Credit Union National Association's latest "Inside Exchange" video, featuring President/CEO Bill Cheney, underscores the importance of credit unions and their members contacting federal lawmakers directly--and now--to say, "Don't tax my credit union."

"Even though credit unions are delivering the message--in ever-increasing numbers--they must "keep up the contacts" to ensure the credit union tax exemption remains intact, Cheney emphasizes in the video.

CUNA continues to engage members of Congress and staff on this crucial tax reform issue, and Cheney notes that credit unions' positive, strong message is being received in the halls of Congress in this week's edition of The Cheney Report.

CUNA created the "Inside Exchange" video series as a new way to directly communicate to member credit unions, and to provide detailed insights into what's happening in Washington, D.C., in the legislative, regulatory and political arenas.

The "Inside Exchange" videos can also be found by clicking on the "stay informed" section of the gray menu bar at the top of the homepage and scrolling down to the "Inside Exchange" pane.

For more on this new video, and The Cheney Report, use the resource links.

Gentile: 'Don't Tax' Campaign Also Drives Home Value Of Membership

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WASHINGTON (7/15/13)--The Credit Union National Association's groundbreaking "Don't Tax My Credit Union" advocacy campaign reinforces the value of credit union membership, Paul Gentile, CUNA executive vice president of communications and strategic messaging, wrote in a new piece.

"It is quite simply a killer campaign" that "engages social/digital media as well as our more traditional lobbying efforts," Gentile added.

More than 336,000 separate congressional contacts have been made since mid-May as part of this CUNA/state credit union league advocacy effort. Credit unions and their members are using CUNA and the state credit union leagues' resources, social media sites including Facebook, and micro-video site Vine, to tell their legislators, "Don't Tax My Credit Union!" This pro-credit union message is also being shared through Twitter feeds, CUNA's Twitter handle @CUNAadvocacy and the hashtag, #DontTaxMyCU.

For those that have not yet joined this effort, "all the reasons to participate are there," Gentile said.

The "Don't Tax My Credit Union!" campaign could serve as a wakeup call for newer members of Congress that have not seen the strength of large-scale credit union grassroots efforts, and to many credit union members that value credit union products and services, but may not be experts on the structural differences between credit unions and banks, he noted.

Key facts such as for every $1 in tax benefit, credit unions give $10 back in member value, both communicate why the tax exemption is vital but also reinforces the value of credit union membership. "You may wake up some members to what in many ways is a true privilege ...Banking with a cooperative that is all about serving them. No shareholders, no profit motives," Gentile wrote.

Further, he said, promoting Don't Tax My Credit Union is another way credit unions can Unite for Good and join CUNA's vision in which "Americans Choose Credit Unions As Their Best Financial Partner."

For more on CUNA advocacy efforts and Unite for Good, use the resource links.

NCUA Plans For Risk-Based Capital Changes

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ALEXANDRIA, Va. (7/15/13)--The National Credit Union Administration will build a "new risk-based capital framework" to protect credit unions and consumers from losses, and replace the "outdated and insufficient" one-size-fits-all capital requirement, NCUA Chairman Debbie Matz told credit unions last week.

The NCUA plan could result in higher capital levels for credit unions with high concentrations of risky assets, she said. The current 7% leverage capital standard, which is required by the Federal Credit Union Act, would remain the floor. However, Matz said, credit unions with assets of $50 million and above could be subject to improved risk-based capital requirements to better correlate required capital levels to risk.

The current 7% leverage capital standard "was really just a best guess" at future requirements, she emphasized. That standard was set in 1998. Recent financial crisis and industry changes require a newer approach, Matz said. However, Matz reaffirmed that Basel III is not right for the credit union industry.

"For many, if not most, credit unions, seven percent of assets may still be appropriate. For higher-risk credit unions, it can be a prescription for disaster when the next crisis hits. We need a flexible, forward-looking standard that makes sense for today and tomorrow," Matz said.

"Job one is preventing another crisis...Our challenge is to make sure that, in the future, credit unions that choose to take on higher risks will be required to meet higher capital standards," she added.

"CUNA has called for risk-based capital standard changes, and has also been urging the agency to adopt a more productive approach to rulemaking that focuses on problem areas rather than issuing rules with blanket applicability, regardless of the credit unions level of risk," CUNA Deputy General Counsel Mary Dunn said.

"This is a very important issue and our Examination and Supervision Subcommittee met with NCUA officials on this issue in June. The subcommittee is meeting again shortly to follow up with NCUA," she added.

For the full NCUA release, use the resource link.

CUNA Suggests Enhancements To Loan Participation Rule

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WASHINGTON (7/15/13)--The Credit Union National Association in a letter Friday commended "the substantial improvements" that were made to the National Credit Union Administration's loan participation rule, but urged the agency to give credit unions latitude as they comply with the rule changes. The rule goes into effect Sept. 23.
CUNA President/CEO Bill Cheney also urged the agency to make the waiver process for the rule's single-originator limit and limits to one borrower meaningful. Cheney, writing to NCUA Chairman Debbie Matz and board member Michael Fryzel, said, "A slow or ineffective process for credit unions seeking to exceed the 100% of net worth limit on loan participations from one originator, or the 15% of net worth ceiling for loan participations involving one borrower, will produce inappropriate results in particular credit union cases and will undermine the current consensus that the overall rule emerged with reasonable terms."
The final rule's limit on loans from one originator of 100% of a credit union's net worth was increased from a proposed 25% of net worth cap, an improvement urged by CUNA.
Cheney also noted, "As you know, we did not support the rule as originally proposed and were active in encouraging credit unions to provide comments. We appreciate the major revisions that were included in the final rule and the opportunity to provide input as part of the process."
He said the delayed effective date of Sept. 23, pushed back from July 25, will facilitate compliance, but added that "credit unions should be given reasonable latitude during their first examination after the rule takes effect if they are making good faith efforts to meet the rule's requirements." The CUNA letter also encouraged the NCUA to post examiner directives regarding this rule on its website and to ensure examiners are well-trained before the changes take effect.
The CUNA letter urged the NCUA to work closely with state regulators in shaping waiver procedures. Any waiver process changes must minimize procedural burdens and maximize positive outcomes, Cheney wrote.
The loan participation rule imposes federal restrictions on state institutions, and CUNA advised the agency that such a situation should not be a standard practice. The NCUA must be mindful of the rights and obligations of state regulators to establish standards for the credit unions they oversee under state law, Cheney said.
CUNA plans to work with credit unions and credit union service organizations (CUSOs) if they have issues with the final rule to discuss how their concerns can be addressed by the NCUA.
Some credit unions have told CUNA the changes made to the final rule "will allow their loan participation programs, in most cases, to remain an important element of their overall lending operations." They were concerned that would not have been the case under the proposal, he noted.
CUSO representatives also said the loan participation rule "will preserve, in most cases, their ability to work with their members to support credit unions' use of loan participations, both as loan originators and participation purchasers," Cheney told the regulators.