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Fed increases HOEPA fee trigger to 592 for 2011

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WASHINGTON (8/5/10)--The minimum fee trigger for Home Ownership and Equity Protection Act (HOEPA) requirements will be increased to $592 in 2011, the Federal Reserve reported this week. The Fed is required to adjust the amount of mortgage fees that trigger additional disclosures under Truth in Lending as required under HOEPA. The Fed has annually adjusted the $400 amount based on the annual percentage change reflected in the Consumer Price Index as reported on June 1, the release added. For the Fed release, use the resource link.

CUNA covers what recent reg reforms mean for CUs

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WASHINGTON (8/5/10)--The Credit Union National Association has provided a comprehensive overview of the portions of the new financial regulatory reform rules that are most relevant to credit unions. Among those items are portions of the legislation that specifically address credit unions, amendments to the Truth in Lending Act regarding residential mortgages, and portions of the to-be-established Consumer Financial Protection Bureau (CFPB) that could address credit union practices. Several reforms set forth by the legislation are of interest to credit unions, including the inclusion of the National Credit Union Administration chairman on a pending financial stability oversight council. Credit unions holding under $10 billion in assets will not be examined by the pending CFPB. The legislation is mainly aimed at Wall Street and larger financial firms, and seeks to help avoid a repeat of the country's recent crisis prompted by a meltdown of housing and mortgage markets. The legislation also addresses thrifts, deposit insurance reforms, hedge funds, credit rating agencies, executive compensation, and investor protections, among other items. For a quick reference guide to the regulatory reforms plus a more comprehensive breakdown of the new regulatory rules and their impact on credit unions, use the resource link below.

CUNA responds to Durbin comment on CU credit cards

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WASHINGTON (8/5/10)--Credit Union National Association (CUNA) President/CEO Bill Cheney has urged Sen. Richard Durbin (D-Ill.) to “take a more complete look at the facts regarding how credit unions and banks offer credit cards differently” after Durbin recently criticized credit unions for increasing annual fees on credit card accounts. “We believe credit unions should be commended--not condemned--for the way that they offer credit cards to consumers,” Cheney added in a letter sent to Durbin late yesterday. In a statement delivered on the Senate floor this week, Durbin expressed concern with rising consumer fees, detailing one example in which, as reported in The Wall Street Journal, credit union annual fees on credit cards “soared” 67% and the median cash-advance and balance-transfer fees assessed by credit unions “jumped by 33%” between July 2009 and March. Cheney said that in spite of this reported information, a July 22 report by the Pew Charitable Trust found that the average annual fee of credit union-issued credit cards “remains significantly lower than the average annual fee on a bank-issued credit card.” “Further, the average annual fee charged by banks and credit unions has increased nearly the same dollar amount, and this increase for credit unions was a consequence of the effect that the implementation of the CARD Act has had on them,” Cheney said, adding that many credit unions continue to offer “no annual fee” credit card options to their members. Cheney added that Durbin may have incorrectly attributed the median cash-advance and balance transfer fee increases to credit unions, as the Pew report found that the median balance transfer fees charged by credit unions during the time period in question “remained unchanged.” “Regardless of any change, these fees remain significantly lower on credit union-issued credit cards than on bank-issued credit cards,” Cheney said. “It is crystal clear that consumers are better off with a credit union-issued credit card than with a bank-issued credit card. Instead of being criticized for accounting for the impact of newly enacted legislation, credit unions should be commended for all that they have done to keep costs down for their members in a seemingly unending period of increased regulatory burdens,” Cheney added. For the full letter, use the resource link.

CUNAs Cheney addresses supervisory other issues

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WASHINGTON (8/5/10)--While the Credit Union National Association (CUNA) appreciates the National Credit Union Administration’s (NCUA) move toward establishing a national registry of potential credit union merger partners, CUNA President/CEO Bill Cheney said that the NCUA should also work to address due diligence and loss-sharing incentives as it further refines its approach to the merger process. In a letter that was sent to all three NCUA board members, Cheney said that the agency also should provide credit unions with greater information on how it works with assorted state regulators in the event that a dual-chartered credit union is involved in a merger. CUNA also recommended that NCUA provide greater detail on its criteria for selecting which credit unions on the merger partner registry should serve as acquirers. Many credit unions are concerned by the NCUA’s increasing use of documents of resolution, letters of understanding and agreement, and cease and desist orders in its supervisory activities, Cheney said, recommending that NCUA further examine some of its own supervisory practices. CUNA’s supervisory working group will examine these and other NCUA practices, and will develop a report that reviews the rights and responsibilities of credit unions during material disputes with examiners. The report will clarify some current NCUA examiner practices and will provide future recommendations to the NCUA, Cheney added. For the full letter to the NCUA, use the resource link.

Inside Washington (08/04/2010)

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* WASHINGTON (8/5/10)--Treasury Secretary Timothy Geithner appears to be pursuing efforts to end Bush-era tax cuts for the wealthy, which will expire at year-end. “These tax cuts save more than $2,000 per year for a typical middle class family,” Geithner said Wednesday at the Center for American Progress. “But given the size of the deficits and debt that we inherited, we must provide that tax relief in a fiscally responsible way.” He said the best way to do that is by allowing the tax rate for the top 2% to go back to levels seen at the end of the 1990s, “a time of remarkable growth and economic strength.” There are some who suggest that the government should hold the tax cuts for the middle class hostage, until Congress extends the tax cuts for the top 2%--and permanently repeals the estate tax too, he added. “If the middle class tax cuts are not extended, Americans will face a sharp increase in taxes and a sharp fall in disposable income,” Geithner said. The cuts, enacted in 2001 and 2003 under former President George W. Bush, will expire at year-end. President Barack Obama said he would extend the cuts beyond this year for 98% of Americans who make less than $250,000 annually, or individual filers who make under $200,000. Republicans argue that because of the economic recovery’s slowdown, the cuts should continue for wealthy Americans, too, because the group includes some small business owners who file individually (The New York Times Aug. 4) ... * WASHINGTON (8/5/10)--The Federal Deposit Insurance Corp. (FDIC) announced that Joseph A. Jiampietro, senior adviser for markets to FDIC Chairman Sheila Bair, will leave the agency Aug. 13. He has served in that position since March 2009. Before joining the FDIC, he served as managing director of the Financial Institutions Group at JP Morgan in New York ...