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NCUA Proposes Rule To Require Written IRR Policy

ALEXANDRIA, Va.-The NCUA Board last week proposed a rule that would require credit unions to develop a written interest rate risk policy and interest rate risk management program as a requirement for federal deposit insurance.

The proposal comes amid growing uncertainty on interest rates caused by new Federal Reserve policies, the ballooning federal deficit and the turmoil in the Middle East and its affects on rates, NCUA said. In addition, credit unions' exposure to interest rate risk has risen in recent years, due, among other things, to a growing portion of assets-now almost 35%-tied up in mortgages. That compares to just 20% for banks.

In proposing the rule, NCUA explained there is no one-rule-fits-all approach but that every credit union needs to devise its own policy based on individual aspects and conditions of the institution.

The rule, issued for a 60-day comment period, would exempt credit unions under $10 million in assets and credit unions up to $50 million with a percentage of first mortgages and investments greater than five years that is less than 100% of net worth.

 

GOP Hammers Warren Over Role With Protection Bureau

WASHINGTON-Republican members of the House Financial Services Committee took presidential advisor Elizabeth Warren to task last week for her role in developing the Consumer Financial Protection Bureau, saying her duties amounted to an end-run around congressional confirmation of a director for the new agency.

"If it walks like a duck and quacks like a duck, then it is a duck," said Rep. Sean Duffy, a Wisconsin freshman, of Warren's denials that her role amounts to being more than a presidential advisor. Warren insisted she is serving at the behest of the Treasury Secretary to create the new consumer bureau, which is styled after her own writings on consumer advocacy.

After the hearing, the Republican members introduced a bill that would create a five-person board to head the consumer agency, instead of a single director.

 

NCUA Was Source of Breach

WASHINGTON-NCUA has confirmed it was the source that unwittingly released a draft authentication update from the Federal Financial Institutions Examination Council (FFIEC) on Dec. 30, 2010, one day ahead of when the formal guidance was to be made public. The release was first reported by BankInfoSecurity.com, which said NCUA released the "Interagency Supplement to Authentication in an Internet Banking Environment" after being unaware of a delay at one FFIEC agency. BankInfoSecurity.com said the report was available on the NCUA site for four to five days over the New Year's holiday, during which time it was downloaded 1,100 times.

 

Reverse Mortgages To Be Offered

TUKWILA, Wash.-Prime Alliance Solutions announced last week it will be offering reverse mortgages to its 1,900 credit union customers through MetLife Home Loans, a unit of MetLife Bank. Through MetLife, Prime Alliance will offer fixed and adjustable rate options for both traditional reverse mortgages and the newly-introduced "HECM Saver" option, which provides consumers with additional options.

Prime Alliance previously entered into a reverse mortgage agreement with Golden Gateway Financial, but the company closed its doors last year. Prime Alliance is a CUSO founded by Boeing Employees CU, known now as BECU.

 

Coastal FCU To Open On Sundays

RALEIGH, N.C.-The $2-billion Coastal FCU last week extended its hours to Sundays with the use of Personal Tellers that allow tellers working from its headquarters in Raleigh to serve multiple branches. The credit union is believed to be the first financial institution in North Carolina that will offer Sunday hours.

Coastal already offers Saturday hours.

 

NAFCU Raises Concerns

WASHINGTON-NAFCU has raised concerns about pending legislation on foreclosure mediation that could be mandatory for lenders. "While NAFCU recognizes this legislation as a well-intentioned effort to mitigate foreclosures in the wake of the subprime mortgage crisis, NAFCU cannot support legislation that opens the door for the establishment of loss mitigation programs, or any other bankruptcy court-led mediation efforts, in which lender participation is involuntary," wrote NAFCU President Fred Becker in a letter to the chairman and ranking minority member of the Senate Judiciary Committee.

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