WASHINGTON - (09/15/05) -- Hundreds of credit unions and bankscould be pushed to the brink of failure by Hurricane Katrinabecause the majority of property owners in the affected areas livedoutside the 100-year flood plain, so are uninsured for thecatastrophic flooding that resulted from the massive storm. "Mostof the flooding was outside the designated flood zone," said Rep.Spencer Bachus, R-Ala., during a hearing on hurricane reliefWednesday. As a result, credit unions and banks representativestold Bachus their constituents are going to need some kind ofgovernment assistance to pay for the billions of dollars in floodclaims for uninsured properties, or else be left holding majorlosses. Such federal assistance, said Charles Elliott, president ofthe Mississippi CU Association, "should be a component" of anydisaster relief bill. "We have people outside the flood plain, whowere told by their agents, 'you don't need flood insurance. It's awaste of money,'" Elliot told members of the House FinancialSubcommittee on Financial Institutions, which is crafting adisaster relief bill. The failure of a government assistancepackage, said Diane Casey-Landry, head of America's CommunityBankers, could be dire for banks, credit unions and other lenders."Otherwise, borrowers will walk away from the loan and leave thelosses with banks," she said. Later, NCUA Chairman JoAnn Johnsonsaid the federal regulator is monitoring the problem. "This issomething we're aware of; I know the President is aware of it,"Johnson told The Credit Union Journal. Bachus, the chairman of thepanel, said he believes some kind of coverage for non-insuredproperties ought to be part of an assistance package. "We're goingto spend all that money (on a financial assistance bill) that oughtto be a component of it," he stated.
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The Philadelphia-based bank's parent company, Republic First Bancshares, had been roiled by a yearslong proxy battle involving activist investors groups and its former CEO.
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The Wyoming-based digital asset bank filed paperwork to challenge last month's district court ruling, which affirmed the Federal Reserve's view about its discretion over master account applications.
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The former head of the Consumer Financial Protection Bureau resigned Friday after the troubled rollout of the Free Application for Federal Student Aid led some House Republicans to call for his resignation.
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The San Antonio-based bank said that loan growth, fueled in part by its expansion in key Texas markets, may compensate for pressure on deposits. It slashed the number of rate cuts it expects this year from five to two.
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Mississippi's Renasant names its next CEO; environmental fintech Aspiration Partners spins out its consumer brand; the OCC adds five weeks to comment period for Capital One-Discover merger; and more in the weekly banking news roundup.
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The Wisconsin banking company forecasted loan growth of 4% to 6% for the full year, driven by an expansion into new commercial and consumer credit lines as well as enduring economic strength in the Midwest.
April 26