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Frank suggests expedited date for some CARD Act provisions

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WASHINGTON (9/18/09)--House Financial Services Chairman Barney Frank is reportedly considering introducing legislation that could move the implementation date for the remaining portions of the Credit Card Accountability, Responsibility and Disclosure (CARD) Act to December 1, Congress Daily reported on Thursday. Frank staffer Steven Adamske told Congress Daily that Frank’s staff were not pleased by what “banks and credit card companies are doing in advance of the effective date." Portions of the CARD Act became effective in late August, and the rest of the bill is scheduled to come into effect in February of 2010. This portion of the recently-passed legislation will restrict lenders ability to increase interest rates and to charge fees or penalties to cardholders. Credit Union National Association President/CEO Dan Mica has spoken out on the bill, saying that some portions of the legislation could "have the unintended consequence of raising compliance costs and making credit more expensive and less available to consumers."

NCUA releases Sept. 24 meeting agenda

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ALEXANDRIA, Va. (9/18/09)--The National Credit Union Administration (NCUA) Thursday released the following agenda for its Sept. 24 meeting:
1. National Credit Union Share Insurance Fund Premium and Stabilization Fund Assessment. 2. Central Liquidity Fund Policies. 3. Insurance Fund Report.
The meeting will be held at 10 a.m. at NCUA headquarters here and will be the first with Deborah Matz presiding as chairman. A closed meeting is scheduled to follow.

Inside Washington (09/17/2009)

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* WASHINGTON (9/18/09)--The Federal Deposit Insurance Corp. (FDIC) has reached an agreement with Residential Credit Solutions (RCS), the winning bidder in a pilot sale of receivership assets that the FDIC is conducting to test the funding mechanism for the Legacy Loans Program. RCS will pay $64 million in cash for a 50% equity stake in a limited liability company (LLC), and the LLC will issue a note of $727 million to the FDIC as receiver. The value of the bid is 70.63% of the outstanding principal balance of the portfolio. The closing is expected to take place later this month. RCS will manage the portfolio and service the loans under Home Affordable Modification Program guidelines ... * WASHINGTON (9/18/09)--Financial observers say the findings of the Financial Crisis Inquiry Commission could be more relevant because financial regulatory reform appears to be put on hold (American Banker Sept. 17). The commission was scheduled to hold its first meeting Thursday. Robert Litan, senior fellow at the Brookings Institution, said the panel could have a stronger impact as financial reform slows down. The commission was mandated by Congress in a mortgage fraud law in May. The panel is expected to study the roots of the nation’s financial crisis. Phil Angelides, former California state treasurer, is commission chairman ... * WASHINGTON (9/18/09)--Senior staff from the Credit Union Association of New York joined credit union leaders to meet with members of New York’s congressional delegation, including Sen. Charles Schumer (D-N.Y.) The credit union representatives urged delegates to lift or eliminate the cap on member business lending, and oppose interchange fee legislation and expansion of the Community Reinvestment Act to credit unions. The group hand-delivered letters from New York small-business owners to Schumer, urging him to continue to take action or lift the lending cap. From left are William J. Mellin, president/CEO of the Credit Union Association of New York, and Schumer. (Photo provided by the Credit Union Association of New York) ... * WASHINGTON (9/18/09)--Banks and insurers are battling for health savings accounts (HSAs) to remain an option for healthcare reform. Money in HSAs is used toward healthcare expenses and future medical expenses. If Congress passes a healthcare reform bill, health plans would have to fulfill certain standards to qualify as “adequate coverage” (The Wall Street Journal Sept. 17). Not all HSAs would make the cut, according to some financial industry experts. Rodney Hood, former National Credit Union Administration vice chair, said credit unions that provide HSAs offer an “exceptional advantage.” Credit unions offering HSAs help businesses with HSA plans, education and employee satisfaction, and provide employees and individuals increased membership to offer more products and services (News Now March 23). As more credit unions begin to offer HSAs, they will be better positioned to be a full-service provider for businesses, Hood added ...

EPC to IWash. PostI Consumers pay for interchange changes

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WASHINGTON (9/18/09)--The Electronic Payment Coalition (EPC) on Thursday responded to merchant claims that the current interchange fee regime should be changed by reiterating its claim that customers would ultimately pay for any interchange alterations that would benefit retailers, The Washington Post reported. In a story published Sept. 17, EPC representative Trish Wexler said that while merchants “appreciate” the benefit and convenience of receiving payments via electronic means, some of the “more vocal” retailers do not want to pay for that benefit. “Who's going to pay? The customers,” Wexler added. The Merchants Payments Coalition today released a study which found that retailers in Europe, Canada and New Zealand generally pay lower interchange fees. A Credit Union National Association (CUNA) epresentative also has detailed her thoughts on interchange fees to congressional staffers, telling them that interchange fee income is vital if her credit union is to stay competitive and relevant. CUNA itself has also spoken out against interchange fee changes, saying that changes to the current interchange fee structure would grant merchants an antitrust advantage in negotiations with card issuers, networks, and other payment system participants. While legislation that would allow merchants to negotiate interchange fees has been introduced on both the House and Senate sides of Congress, this legislation is not expected to be brought up during the fall session.

House votes to eliminate Ed. Loan program

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WASHINGTON (9/18/09)—The House voted 253-171 Thursday in favor of H.R. 3221, the Student Aid and Fiscal Responsibility Act of 2009, which would terminate the Federal Family Education Loan Program (FFELP). The Obama administration has estimated that eliminating the subsidies provided under FFELP could save the government more than $4 billion, annually. A portion of that $4 billion savings could then be used for direct loans to low-income students through need-based Pell Grants, the administration has said. The Credit Union National Association (CUNA)opposes elimination of the student loan program and has expressed concerns to lawmakers that an elimination of FFELP private student funding would remove a "valuable option" for students. More than 1,000 credit unions provide student loans, according to CUNA, with a particular concentration among credit unions that base their membership around a university. Credit unions that provide direct student loans also provide individualized service and support to loan holders, but these services would be jeopardized if the FFELP is discontinued, CUNA has warned. The next stop for this bill is the Senate. A comparable bill has not yet been introduced there.