Rule Would Allow Foreign Currency Investments
ALEXANDRIA, Va.-NCUA introduced a proposed rule that would allow credit unions to create investment vehicles that use foreign currency. The Advance Notice of Proposed Rulemaking is aimed at helping credit unions help members who live abroad, allowing them to make investments using foreign currency.
As expected, the board also adopted amendments to parts 748 and 749 in a final rule on the Catastrophic Act Reporting and Records Preservation.
Also on the docket was the mid-session budget review. Total budgeted operating costs for the 12-month period ending Dec. 31, 2007, are projected to decrease by $739,637 or 0.5 percent, which includes all increases, decreases, new requests, and revised estimates.
HMDA Gets Mixed Review In House Panel Hearing
WASHINGTON-The House Financial Services Subcommittee on Oversight and Investigations heard everything from how HMDA is a valuable tool for rooting out unfair lending practices to how HMDA has utterly failed to do just that during a hearing. Federal financial regulators, including NCUA, outlined how HMDA is used to detect unfair lending practices and suggested the current process is working fine.
Indeed, the American Financial Services Association agreed with the agencies, suggesting any expansion of HMDA could cause a bevy of problems, not the least of which is a threat to consumer privacy. Not surprisingly, the National Community Reinvestment Coalition took a different view. "As powerful as HMDA data has been in the efforts to stop discrimination, the full potential of HMDA has not been realized because key data elements remain missing from HMDA data," NCRC CEO John Taylor said, who added "fair lending and consumer protection regulation has failed to protect consumers adequately."
CUNA Blasts Tax Exemption Report
WASHINGTON-CUNA blasted a Treasury report that suggests repealing the credit union tax exemption as one way to fund reduced corporate income taxes. In a letter to Treasury Secretary Henry Paulson, CUNA CEO Dan Mica cited past Bush Administration statements in support of the credit union tax exemption and said this most recent analysis "wholly contradicts the 2004 letter to CUNA from President Bush" supporting the tax-exempt status of credit unions. "Under this administration, the Treasury has consistently recognized the benefits of credit unions and stated its support for the credit union tax exemption; we urge that position be continued," Mica wrote. The letter is a response to the "Treasury Conference on Business Taxation and Global Competitiveness Background Paper" that was released in advance of the Treasury's upcoming conference. The letter also was distributed to House Financial Services Committee Chairman Barney Frank and House Ways And Means Committee Chairman Charles Rangel.
Pandemic Exercise Encouraged
ALEXANDRIA, Va.-At last week's NCUA Board Meeting, Chair JoAnn Johnson reiterated her desire to see as many credit unions as possible participate in the upcoming test of the financial services sector's ability to withstand a bird flu outbreak or other pandemic.
Sponsored by the Treasury Department, the online exercise aims to bring together credit unions, banks, brokers, insurers and other financial services firms to examine contingency plans for a number of areas, including continuity of operations, transportation, telecommunications, human resources and energy. Using a secure website, from Sept. 24 through Oct. 10, the test will simulate development of a potential outbreak.
For info: www.fspanfluexercise.com.
Home Sales Drop to 2002 Levels
ARLINGTON, Va.-Existing home sales declined for the fourth straight month, according to data gathered by the National Association of Realtors and analyzed by NAFCU. Noting June's decline of 3.8% is the slowest monthly pace since November 2002, NAFCU said the decline is slightly worse than what most economists expected, indicating a continued softening of the housing market. NAFCU said it expects the median home price to continue to drop this summer and then gradually rise by year-end. As credit unions have increasingly turned to real estate loans to make up for stagnant auto loan growth, all eyes have been on how the weakening housing market, combined with big rate adjustments in adjustable rate mortgages, will impact credit union real estate lending.
