NCUA Proposal Would Allow Investments In Derivatives
ALEXANDRIA, Va.-The NCUA Board last week proposed a new derivatives rule that almost immediately drew some criticism. Under the proposal, FCUs (and state charters OKd by their regulator) that are well-managed and are $250 million in assets or larger will be able to use simple derivatives as a hedge against interest-rate risk using swaps and caps. The program would be managed by NCUA and fees would be charged to cover any related costs. The agency is estimating that somewhere between 75 and 150 credit unions will likely apply to the program in its first two years.
NAFCU said it has "serious questions" about the proposal.
"NAFCU has strongly advocated for expanding credit union investment powers that includes limited derivatives authority," said NAFCU CEO Fred Becker. "A key aspect of NCUA's proposed rule seeks to establish a 'pay-to-play' regulatory scheme for credit unions that seek to, and subsequently are permitted to, engage in derivatives activities. A 'pay-to-play' requirement would be a first for our industry and would create a significant long-term strategic question by potentially setting a precedent for other activities that credit unions might seek to engage in the future."
Trades Support Metsger As Nominee For NCUA Board
WASHINGTON-The credit union trade associations last week were offering support for the nomination by President Obama announced of former Oregon State Sen. Rick Metsger (D) to fill the vacant seat on the NCUA board. That seat has been open since 2012 following the departure of Gigi Hyland.
Metsger has a background in credit unions, having served on the board of Portland Teachers Credit Union from 1993-2001. His political career ran from 1999-2011 while serving as an Oregon state senator, including as president pro-tempore the last two years in office. He was also a member of the Oregon Debt Policy Advisory Commission member from 2001 to 2011, and has a background in financial literacy, having served on the board of the nonprofit Financial
Rep. Wants Limits On FHA
WASHINGTON-The House Financial Services Committee will roll out a bill to scale back the Federal Housing Administration single-family program in the "next month or so," according to Rep. Randy Neugebauer (R-TX). "FHA has moved way beyond their original charter," the Texas congressman said during his remarks at the National Association of Realtors Conference.
FHA should be focused on financing "first-time and low- and moderate-income homebuyers," Neugebauer said.
OK CUs Give OK To Cornerstone
NORMAN, Okla.-The final step in the consolidation of CU leagues in Texas, Arkansas and Oklahoma has taken place as member credit unions of the CU Association of Oklahoma voted 49-10 in favor of a single organization representing the three states. With approval given by member CUs in all three states, the Cornerstone Credit Union League will become official July 1. The newly merged league's board of directors will be made up of three directors from Arkansas, three directors from Oklahoma and 12 directors from Texas.
Sebastian Plans To Retire
WASHINGTON-Wendell "Bucky" Sebastian, executive director of the National Credit Union Foundation, announced last week he will retire, effective June 30. Sebastian has been executive director at NCUF since May 2010 after previously serving 20 years as CEO of Tampa, Fla.-based GTE FCU. From 1981-1985 Sebastian was NCUA's executive director/general counsel and was later a co-founder of Callahan & Associates.
New Round Of ATM/ADA Lawsuits
BAY CITY, Mich.-A new round of lawsuits challenging readiness for the sight-impaired ATM provisions of the Americans With Disabilities Act is targeting CU. Legally blind consumers have filed suits in the past few weeks against United Bay Community FCU, Sharefax CU, Chartway FCU, The Golden 1 and other ATM owners claiming lack of compliance with ADA.
