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NCUA doc covers 2012 CU trends

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ALEXANDRIA, Va. (9/28/12)--Details on credit union membership, assets, net worth, earnings and other industry metrics for the first half of 2012 are summarized in the National Credit Union Adminisration's (NCUA) compilation of credit union financial trends.

The NCUA documents notes that, in the first half of 2012:

  • The number of federally insured credit unions dropped by 133;
  • The number of current credit union members grew by 1,317,199, to total 93.1 million;
  • Credit union assets increased $45.95 billion;
  • Credit union net worth dollars increased by $4.15 billion, to total $102.41 billion; and
  • Shares increased by $41.39 billion, with strong growth in regular shares, share drafts and money market shares.
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The NCUA credit union trend document reflects data that was reported in the NCUA's second quarter call report document, which was released on Aug. 31. The credit union industry's overall performance grew stronger in almost every category during the second quarter of 2012, as charge-offs, bankruptcy filings and loan loss reserves also declined.

The first-half credit union data is broken down into chart form in this latest NCUA release.

For the full NCUA release, use the resource link.

CFPB offers remittance guidance webinar

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WASHINGTON (9/28/12)--The Consumer Financial Protection Bureau (CFPB) has announced an Oct. 16 webinar and new guidance to help credit unions and other financial institutions prepare for pending remittance transfer regulations.

The CFPB's new remittance rule, which is scheduled to take effect on Feb. 7, will require remittance transfer providers to disclose the exchange rate, all fees associated with a transfer, and the amount of money that will be received on the other end. Remittance transfer providers also will  be required to investigate disputes and correct errors. The CFPB has provided a safe harbor exemption from the rule for remittance providers that transact 100 or fewer remittances per year.

The agency this week published a safe harbor list of countries that qualify for an exception in the remittance rule. Remittance providers in these countries are allowed to file estimates of certain figures in lieu of disclosing exact amounts, as local law does not permit financial institutions to disclose the exact amounts of transactions.

The October remittance webinar will give participants an overview of the rule. Credit unions, money transmitters, banks and other companies that send money abroad for consumers, as well as other organizations that work with or represent consumers who send money abroad, can have their compliance questions answered, the CFPB said. Participants may send their questions to the CFPB until Oct. 5, and must register for the webinar by Oct. 9, the CFPB said.

The CFPB said it is also planning to release a small-business compliance guide to the remittance rule soon.

The Credit Union National Association (CUNA) continues to urge the CFPB to consider ways to lessen the impact of the final international remittance transfer rule on credit unions, and has asked the agency to increase the safe harbor exemption beyond 100 transfers.

CUNA President/CEO Bill Cheney, General Counsel Eric Richard and Deputy General Counsel Mary Dunn met with CFPB Director Richard Cordray on the remittance issue earlier this month. Cheney urged Cordray to distinguish in the agency's rulemaking between credit unions that champion consumers' interests and other service providers in the financial marketplace. Cheney and Cordray also discussed foreign tax disclosures and liability issues related to the remittance transfer regulations during that meeting.

For more on the CFPB guidance and the webinar, use the resource link.

Low mortgage rates can be help hindrance for CUs CUNA

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WASHINGTON (9/28/12)--Record low mortgage rates, like those reported this week, "are something of a double-edged sword for credit unions," Credit Union National Association (CUNA) Chief Economist Bill Hampel said Thursday.

"On the one hand, the resulting refinancing boom will generate significant income. Also, the stronger the recovery in the housing market, the better the outlook for moderation in future National Credit Union Administration (NCUA) corporate stabilization assessments. On the other hand, higher-rate mortgages in credit union portfolios are being prepaid, and replacing those mortgages with new mortgages at these very low interest rates is perilous," he said.

Five-year adjustable-rate mortgages (ARMs) were the only mortgage products not to set records for the week ended Sept. 27. Freddie Mac reported that all-time low average rates for 30- and 15-year fixed-rate mortgages and one-year ARMs "helped keep homebuyer affordability high and refinancing strong to support an already improving housing market."

Thirty-year fixed-rate mortgages averaged 3.40% this week, 3.49% last week and 4.01% this time last year. Fifteen-year fixed-rate mortgages averaged 2.73% this week, 2.77% last week and 3.28% this time last year.

Freddie Mac Vice President and Chief Economist Frank Nothaft said the fixed-rate decreases were largely due to the Federal Reserve's purchases of mortgage securities and should support an already improving housing market.

Five-year ARMs averaged 2.71% this week, compared with 2.76% the previous week and 3.02% the same week last year.

The average one-year ARM was 2.60%, down slightly from the 2.61% average reported last week. One-year ARMs averaged 2.83% this week last year.

Sales of existing homes continued to improve last month, as the national median price rose on a year-over-year basis for the sixth consecutive month. According to the National Association of Realtors (NAR), total existing-home sales--which are completed transactions that include single-family homes, townhomes, condominiums and co-ops--rose 7.8% to a seasonally adjusted annual rate of 4.82 million in August.

The August 2012 number is 9.3% higher than the 4.41 million-unit level reported in August 2011. New housing starts also increased last month, reaching the highest level seen in two years, the U.S. Department of Commerce reported.

These signs of recovery in the housing market bode well for credit unions and the economy in general, and indicate that consumers are generally more confident and willing to spend, CUNA senior economist Mike Schenk said last month.

Inside Washington (09/27/2012)

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  • WASHINGTON (9/28/12)--Nine Minnesota credit union representatives were in Washington,
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    D.C., Sept. 19-21 for the Minnesota Credit Union Network's annual Hike the Hill event. During meetings with the state's congressional delegation, the group focused on the pending member business lending (MBL) vote in Congress. They urged legislators to support the Small Business Lending Enhancement Act. Credit unions and the Credit Union National Association (CUNA) are urging Congress to increase the MBL cap to 27.5% of assets from 12.25%. Doing this would help the economy by injecting $13 billion for new small-business loans and would help generate 140,000 new jobs the first year. Doing so would not cost taxpayers, CUNA said. The Minnesota group also discussed the necessity of passing legislation eliminating the need for physical fee disclosures on ATMs, and the difficulty in conducting credit union operations in today's stringent regulatory environment. Attendees also visited National Credit Union Administration headquarters to meet with Chairman Deborah Matz and board member Michael Fryzel, pictured at the center of the photo. (Photo provided by the Minnesota Credit Union Network) …
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