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April Legislative Update Webcast covers capital, housing, patent reform status

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WASHINGTON (4/18/14)--In the April edition of the Credit Union National Association's "Legislative Update Webcast," CUNA Senior Vice President of Legislative Affairs Ryan Donovan gives a quick update on five essential credit union issues: Capital reforms, housing finance reforms, merchant data breaches, patent reforms and regulatory burdens.

This list of issues, when combined with others such as interchange and overdraft protections, represents a number of topics that could come up "on any given day" for credit unions on Capitol Hill. There are plenty of things CUNA hopes Congress will take care of, and other things they hope Congress won't touch, Donovan emphasized.

Each month, CUNA's legislative update webinar breaks down vital information on top congressional concerns into an easy to access and understand format.

The May edition of the legislative update webinar will be released in early May in advance of that month's Hike the Hill meetings.

For the full 15-minute April webinar, use the resource link.

Technical difficulty disrupts News Now distribution

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WASHINGTON and MADISON, Wis. (4/18/14)--(Editor's note: Due to technical problems with our website operations Thursday--now resolved--emails of the daily News Now headlines were not distributed as per usual at 5 a.m. (ET). The news on the CUNA homepage was not updated. News Now regrets the inconvenience to readers. Now that the technical problems have been resolved, News Now is back on schedule.)

New video provides NCUA answers to CUs' RBC questions

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ALEXANDRIA, Va. (4/18/14)--A two-part, 20-minute video has been released by the National Credit Union Administration, one that is intended to help federally insured credit unions with questions about the agency's proposed risk-based capital rule.

The new NCUA resource for credit unions is free and available on its YouTube channel (see resource link).

"NCUA's risk-based capital proposal is complex, but its overall purpose is simple," NCUA Chairman Debbie Matz said in a release. The video, she said, clears up "misinformation," explains why the agency believes the rule is necessary, and how it would affect credit unions. It also, she added, helps credit unions understand how and why the NCUA's proposal differs from the Federal Deposit Insurance Corp.'s rule and Basel III.

Comments on the RBC plan are due to the agency by May 28.  The Credit Union National Association and the National Association of Federal Credit Unions continue to urge a 90-day extension to the comment deadline.  (See related story: CUNA, NAFCU jointly repeat urging for RBC comment extension.)

CUNA has extensive resources for credit unions regarding the RBC plan.  Use the resource link.

Carolina CUs, armed with membership numbers, call on lawmakers

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WASHINGTON (4/18/14)--"Preparation is key to effective visits with legislators," Carolinas Credit Union League Director of Government Relations Billy Boylston said this week, highlighting how the Credit Union National Association's Project Zip Code (PZC) helped advocates from Palmetto Citizens FCU, Columbia, S.C., prepare for their visits to the nearby South Carolina State House.

The $602 million-asset credit union provided a summary document that includes membership data by legislative district taken from PZC documentation. "Palmetto Citizens has done a great job preparing and presenting information, and it shows in legislators' responses," Boylston added (In the Loop April 17).

Credit unions can also use PZC to better track their membership and to plan future ATM and branching expansion. Project Zip Code protects the privacy of credit union members, as only membership totals per legislative district and county, and not information on individual members, are transmitted from credit unions to the PZC database.

The number of credit union members matched to their respective legislative districts and counties by CUNA's PZC software has reached another milestone: 82.7 million members. Around 700,000 of these matches have been made in the month-plus since the 2014 CUNA Governmental Affairs Conference.

The PZC version 14.0 software was introduced during this year's GAC.

The software, and the data gleaned from it, can give credit union supporters a great advantage as they work to advocate for credit unions and their members. The data will be vital as this fall's election season comes into full swing.

PZC data allows CUNA, the leagues and credit unions to show elected officials how many credit union members are among their constituents with very clear numbers. "The more credit unions that participate in Project Zip Code, the more accurate these membership counts will be," said Kristen Prather, CUNA grassroots manager and day-to-day PZC manager.

For more Project Zip Code information, use the resource link.

NCUA a-Twitter with fin. lit. chat

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WASHINGTON (4/18/14)--Interested in sharing best practices for helping members increase their financial literacy? The National Credit Union Administration has set an April 23 Twitter chat on the issue.

The NCUA Financial Literacy Twitter chat is scheduled to take place between 11 a.m. and noon ET. The event will be hosted by Kenneth Worthey, financial literacy and outreach analyst with NCUA's Office of Consumer Protection.

Followers can take part in the conversation by watching the agency's @TheNCUA Twitter feed and the #NCUAChat hashtag. Participants can also submit questions before the chat to

The Twitter chat is part of the NCUA's National Financial Capability Month activities. This month, the NCUA has also used its consumer-oriented Twitter feed @MyCUgov to share personal finance tips with the public, and hosted a financial literacy webinar to share best practices.

The NCUA Twitter talk will take place during National Credit Union Youth Week, April 20-26. Sunny beaches and rolling waves are a part of this year's theme, which encourages young potential credit union members to "Catch the $ave Wave." During the week, credit unions will engage and encourage younger members to set up savings accounts, learn how to manage money and be more financially literate.

Credit unions nationwide may join in the celebration through April, or even just during National Credit Union Youth Week.

Stress testing for large CUs, common bond proposal on next NCUA agenda

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ALEXANDRIA, Va. (4/18/24)--A final stress testing rule for large credit unions will lead the agenda when the National Credit Union Administration holds its April open meeting next Thursday.

Under a proposed version of the stress test regulation released last year, federally insured credit unions with assets exceeding $10 billion would be required to develop and maintain capital plans, and undergo annual stress tests.

The stress test requirements, drafted by the agency's Office of National Examinations and Supervision, would require impacted credit unions to conduct specific capital analyses to evaluate how changes in variables, parameters and inputs used by credit unions in their capital plans could affect their capital. Credit unions would also need to test how interest rate shocks of at least plus or minus 300 basis points would affect their net economic value.

"While we acknowledged the utility of stress testing, we did not feel a new rule was necessary or that NCUA had substantiated the need for it," Credit Union National Association Deputy General Counsel Mary Dunn said.

CUNA offered recommendations that would help improve the proposal, including:

  • Stress test results should not be disclosed publicly;
  • Sanctions should not apply if planning or test benchmarks are not met; and
  • Rejection of a credit unions' capital plan should only occur under a formal process.

Other items on the agenda include:

  • A new proposal that would address requirements for multi-group credit unions to add associational groups;
  • A board briefing on a proposed interagency policy statement addressing joint diversity standards for regulated entities;
  • A board briefing on a proposed interagency rule on loans in areas having special flood hazards;
  • The quarterly National Credit Union Share Insurance Fund report;
  • A final rule on the electronic filing of financial reports; and
  • A final rule on liquidity and contingency funding plans.

The Thursday open meeting is scheduled to begin at 10 a.m. (ET).

Two federal credit union act requests are on the closed board meeting agenda.

For the full NCUA agenda, use the resource link.

CUNA, NAFCU jointly repeat urging for RBC comment extension

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WASHINGTON (4/18/14)--Joining forces, the Credit Union National Association and National Association of Federal Credit Unions Thursday urged a 90-day extension for the comment period for the National Credit Union Administration's risk-based capital plan (RBC), set to elapse on May 28.
Both organizations previously asked for just such an extension back in February, and it was denied by the agency. 
"We simply do not believe that the comment period provides sufficient time for a number of credit unions to analyze the proposal's impact on their individual operations and prepare their responses,"  CUNA President/CEO Bill Cheney and NAFCU President/CEO Dan Berger wrote to the NCUA board members.
"Given the health of the credit union system, we do not see the need to rush this rule and believe more time for comments will also benefit the agency through the production of well-reasoned letters," the credit unions leaders argued.
The joint letter called the RBC plan the "most significant proposed rulemaking that credit unions will face this year and likely for years to come." It noted that credit unions already are struggling, in some cases, to meet an onslaught of new regulatory requirements this year, and need additional time to provide the NCUA with substantive comments on the RBC plan that reflect their particular situations.
CUNA strongly supports risk-based capital for credit unions, but warns that the NCUA's current proposal is not the approach to take. CUNA analysis shows that, as written, the NCUA plan could force credit unions to hold as much as $7.3 billion in additional capital.
As described in the Federal Register, the NCUA proposal would revise the risk-weights for many of the NCUA's current asset classifications, require higher minimum levels of capital for federally insured natural-person credit unions with concentrations of assets in real estate loans, member business loans (MBLs) or higher levels of delinquent loans; and set forth the process for the NCUA to require an individual federally insured natural-person credit union to hold higher levels of risk-based capital to address unique supervisory concerns raised by NCUA.
It would apply to credit unions with $50 million or more in assets.