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Mo. league relates states CU concerns to NCUA

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ALEXANDRIA, Va. (8/30/10)--The Missouri Credit Union Association’s (MCUA) recent board resolution on key credit union issues resulted in a letter to the National Credit Union Administration (NCUA), which related credit union concerns regarding such things as merger policy and share insurance assessments. “The resolution, passed unanimously by the MCUA board, makes a strong statement that there is concern over NCUA actions and their effect on the sustainability of the credit union system in this stressed economy,” said Rosie Holub, MCUA president/CEO, of the board action. “Our hope is that the agency will respond positively and act within their statutory and discretionary authority to minimize the impact of the assessments on credit unions.” In its letter to the NCUA earlier this month, the Missouri association strongly urged the NCUA to allow the maximum time period for restoration of the equity ratio for the National Credit Union Share Insurance Fund and the corporate stabilization fund through assessments. Holub wrote such action is needed to “preserve the ability of credit unions to financially recover” in the face of economic woes and increased strain on credit union income and capital from legislative initiatives, which will results in a string of new regulations, the “negligible investment interest rate environment, and declining loan demand,” which the association predicts will continue for the “foreseeable future.” On the topic of mergers, the MCUA letter noted Missouri credit unions’ concern that mergers are approved without adequate coordination with stakeholders. Holub reminded the NCUA that for mergers of state-chartered credit unions, state leagues and state regulators can be a valuable resource in understanding “membership base and service needs within the immediate vicinity...[and] regional culture.” “We urge that priority be given to proximity and in-state merger acquirers within your due diligence process,” the letter said. Addressing “supervisory issues and actions,” in broader strokes, the MCUA letter said recent actions by the NCUA “appear to be less operationally constructive to survival of credit unions and, in effect, more punitive.” “We urge the agency to ensure that the examination staff is acting consistently with the directives of the NCUA board in assessing and implementing enforcement actions,” the letter stated.

Treasury seeks comment on fin. lit. direction

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WASHINGTON (8/30/10)--The U.S. government is working to develop a list of financial education core competencies to further efforts to increase the financial literacy of the country’s population. The Treasury Department, as lead agency of the Financial Literacy and Education Commission (FLEC), is seeking public comment on the list. The department is proposing the development of core competencies for financial education because of its perception that the financial education field lacks a common understanding of what the administration is trying to achieve through its national strategy to promote basic financial literacy and education. Treasury has identified five core concept areas:
* Earning; * Spending; * Saving; * Borrowing; and * Protecting against risk.
In the Treasury proposal, each concept area is broken down into specific things consumers should be taught in each category. Treasury specifically seeks comment on whether the list of core competencies “is complete and whether there are portions that should be deleted, revised, or expanded.” Comments are due on Sept. 12. The National Credit Union Administration (NCUA) is part of a 20-agency make-up of FLEC. NCUA Chairman Debbie Matz, at the 2010 Congressional Financial Literacy Day last April, noted credit unions' dedication to, and efforts to strengthen, consumer financial education programs and outreach. "If there's one clear and obvious bright spot in the recent economic turmoil, it's the rededication of NCUA and the credit union industry to financial education," Matz said, adding that "credit unions demonstrate a natural affinity for making real-world, practical and useful financial literacy tools available to their members.”

Inside Washington (08/27/2010)

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* WASHINGTON (8/30/10)--Neighborhood stabilization in the face of massive foreclosures is the topic of a Federal Reserve System national summit on Sept. 1-2. Neighborhoods with high numbers of foreclosed properties face a raft of problems, such as declining property values, loss of public services due to reduced tax revenue, and increased levels of crime. The symposium is intended to take an extensive look at practical and tested strategies that nonprofit organizations, local and regional governments, federal officials, and lenders can use to mitigate the impact of vacant and real estate owned (REO) property--property held on the books of banks, typically after failure to sell at foreclosure auction. Summit speakers shall include Federal Reserve Governor Elizabeth A. Duke; U.S. Department of Housing and Urban Development Secretary Shaun Donovan; Federal Reserve Bank Presidents Charles Evans (Chicago), Sandra Pianalto (Cleveland), and Eric Rosengren (Boston); and representatives of various sectors involved in the foreclosure process and community stabilization efforts. Live video of the event will be available online at: http://www.ustream.tv/channel/federalreserve ... * JACKSON HOLE, Wyo. (8/30/10)--Federal Reserve Board Chairman Ben Bernanke said Friday that if the economic recovery remains slow and threatens to slip into a cycle of falling prices, the Fed will stand ready to resume its large purchases of longer-term debts, adding to its already hefty level of such holdings. Speaking at the Federal Reserve Bank of Kansas City’s Economic Symposium here, Bernanke said specifically, “I believe that additional purchases of longer-term securities, should the (Federal Open Market Committee) choose to take them, would be effective in further easing financial conditions.” The FOMC sets interest rates. Bernanke also said, however, that he believes that economic growth would continue in the second half of this year, although he predicted it would come at a modest pace. debt-crisis abate, and increased consumer savings levels. He further predicted a “pickup of growth in 2011” if certain “preconditions” stay true--such as increased bank lending, decreased concerns over the European sovereign “Stronger household finances, rising incomes, and some easing of credit conditions will provide the basis for more-rapid growth in household spending next year,” the Fed leader said …