Financial Crisis News Center

Letter to Credit Unions Addresses Premium Assessments

This story appeared in Bank Digest.

The NCUA has issued a Letter to Credit Unions on recent action it took to maintain the strength of the National Credit Union Share Insurance Fund (NCUSIF) and begin the repayment of the Treasury borrowing for the corporate credit union stabilization plan. It noted that, as projected in prior guidance to credit unions, the resulting combined premium collection to credit unions is 15 basis points of insured shares. The invoice for the assessment will be sent in the fourth quarter of 2009 with payment due within 30 days of the invoice date.

09-CU-20 at http://www.ncua.gov/Resources/Letters/09-CU-20.pdf

Stress Testing Results at http://www.ncua.gov/Resources/Letters/09-CU-20(Attachment1).pdf

Corporate Credit Union Reserve at http://www.ncua.gov/Resources/Letters/09-CU-20(Attachment2).pdf

Credit Union Letter Addresses Loan Modification Programs

This story appeared in Bank Digest.

The NCUA has issued a Supervisory Letter on evaluating residential real estate loan modification programs. The Letter notes that, during this economic downturn, many credit unions are offering some type of loan modification, or other workout solution, to their distressed residential mortgage borrowers. The loan modifications will vary by credit union and by loan. The Letter lists “fundamental components” that examiners should look for in any loan modification program.

US Central CEO Replaced

This story appeared in Bank Digest.

The National Credit Union Administration  has announced that the US Central Conservatorship Advisory Board voted to replace US Central Federal Credit Union Chief Executive Officer James Nance. The action was taken due to divergent views about how to move US Central forward. Effective immediately, US Central Senior Vice President and General Counsel Francois Henriquez will assume the role of Interim CEO, and a search committee will begin a process to  determine a successor.

http://www.ncua.gov/news/press_releases/2009/MR09-0925a.htm

DeMarco Addresses National Association of Federal Credit Unions

This story appeared in Bank Digest.

In remarks before the National Association of Federal Credit Unions 2009 Congressional Caucus on Sept. 21, 2009, FHFA Acting Director Edward J. DeMarco commented on credit unions' role in restoring the housing market, stating that “credit unions continue to have an important role to play with respect to the country's recovery from the housing market mess of the past few years. And this is true for all credit unions, whether they make mortgage loans or not.” He added that, “The core of credit unions' mission, and their long history, speaks to working with households, especially households of modest means, to gain financial literacy and build a solid financial foundation that leads to economic opportunity. All of us need to refocus our energies on such a mission.”

Matz Sounds Themes of Urgency and Involvement at NAFCU Caucus

This story appeared in Bank Digest.

NCUA Chairman Deborah Matz on Sept. 21, 2009, noted the credit union industry's resilience and commitment to cooperative principles in the midst of economically difficult times in her address to the National Association of Federal Credit Unions (NAFCU) Congressional Caucus in Washington D.C. Identifying important tasks on the NCUA's agenda, Matz said, “Revising the corporate credit union rule is imperative. I cast the lone dissenting vote against the corporate rule when it was revised in 2002. I did not believe the crucial issue of risk concentration was adequately addressed. I also believed the investment authority being granted was overly broad and permissive, particularly in light of the complexity of financial instruments available to corporates. These issues must now be dealt with in NCUA's new rule.”

Credit CARD Act Compliance Concerns Addressed

This story appeared in Bank Digest.

In response to credit union concerns about compliance with new requirements under the Credit Card, Accountability, Responsibility, and Disclosure Act of 2009 (Credit CARD Act), National Credit Union Administration Chairman Debbie Matz underscored the NCUA’s commitment to consumer protection and ensuring credit union compliance, while recognizing some credit unions may have technical difficulties and the need for examiners to work with credit unions on a case-by-case basis. Matz noted “understand some credit unions may experience difficulties complying with the requirement of the Credit CARD Act and the Federal Reserve Board’s interim rule regarding the mailing of periodic statements. The amount of time necessary to come into full compliance will likely vary, depending on the type of credit arrangements a credit union offers its members and, in many cases, the cooperation of third party vendors in revising billing procedures and statements. All credit unions are expected to come into full compliance as early as reasonably possible, and to demonstrate their efforts to do so. In the interim, credit unions should follow the alternative allowed by the Federal Reserve. Like any regulatory compliance matter, examiners will review credit union efforts to achieve compliance. In no event can credit unions impose a late fee or change terms except as permitted by the Credit CARD Act and the Federal Reserve’s regulation.”

http://www.ncua.gov/news/press_releases/2009/MR09-0828c.htm

Townhall Meetings Scheduled

This story appeared in Bank Digest.

National Credit Union Administration Chairman Deborah Matz has announced three NCUA Town Hall Meetings to discuss corporate credit unions and other credit union issues. Matz noted, “The dislocations experienced by the financial markets have had a significant effect on both corporate and natural person credit unions, and it is incumbent on NCUA and the industry to come together in a forward-looking and reasoned manner to find solutions.” She added, “we can turn the broader challenges into a catalyst for changes that will set a course for an even brighter future for the credit union industry.”

http://www.ncua.gov/news/press_releases/2009/MR09-0828b.htm

Deborah Matz Sworn-in as NCUA Chairman

This story appeared in Bank Digest.

Deborah Matz was sworn in as Chairman of the National Credit Union Administration on Aug. 24, 2009. At the swearing in ceremony, Matz said, “The opportunity to serve as Chairman of the National Credit Union Administration is both an honor and a significant responsibility. I am assuming the Chairmanship at a particularly crucial period in the history of the Agency and the industry, and the prospect of making a real difference in light of the challenges we face is one that I welcome.”

Hyland Urges Continued Collaboration Between State and Federal Regulators

This story appeared in Bank Digest.

Speaking to participants at the National Association of State Credit Union Supervisors State System Summit, National Credit Union Association Board Member Gigi Hyland noted, “Over the past four years, NCUA and state supervisors have built a strong, collaborative working relationship. The dialogue and communication must continue as we work through these difficult economic circumstances.”

Hyland also discussed a variety of current issues affecting the supervision of credit unions such as the NCUA’s work on proposed changes to the corporate credit union rule as well as recent changes to the Central Liquidity Facility. Finally, Hyland addressed her supplemental capital initiative that she launched last December. She noted that in collaboration with state supervisors, “the agency has come along in refining its ideas on the qualities of supplemental capital that align with the credit union cooperative financial business model.”

http://www.ncua.gov/news/press_releases/2009/MA09-0821.htm

Fryzel Comments on Member Business Lending Legislation

This story appeared in Bank Digest.

NCUA Chairman Michael E. Fryzel has issued a statement regarding the newly-introduced Kanjorski-Royce credit union member business lending bill. Fryzel noted that “at a time of economic difficulty, credit unions have stepped forward to provide access for small business people to fairly priced credit, and I am pleased that Congressmen Kanjorski and Royce have once again placed a priority on improving member business lending options for credit union members.” The chairman added that “NCUA looks forward to working with Congress as the legislative process progresses to produce a bill that enhances safe, well-supervised and beneficial member business lending.”

Statement at http://www.ncua.gov/news/press_releases/2009/7-30FryzelCommentsonKanjorski-Royce_Legislation.pdf