Sallie Mae Gets Into Mortgages
RESTON, Va.-Sallie Mae, the dominant player in the student loan market, said it has acquired Pioneer Mortgage, a Novi, Mich., mortgage banker, signaling its expansion into the mortgage lending market. It is the second mortgage banking acquisition for Sallie, following December's deal for First Trust Financial, a mortgage bank with operations in Massachusetts, Rhode Island and New Hampshire.
Under the deal, Pioneer, which provides mortgage lending in Michigan and Arizona, will operate as a wholly owned subsidiary of SLM Corp., the holding company for Sallie Mae, which now claims more than $80 billion in assets.
Sallie, originally created to facilitate a secondary market for guaranteed student loans, has extended into student loan originations under a 1998 reorganization and now accounts for half of the private-sector student loans originated in the U.S. The company has also diversified into consumer lending.
Price Rises For Oregon Tax Bid
SALEM, Ore.-A proposal to apply the state's 6.6% excise tax on the state's largest credit unions could cost them millions of dollars a year, according to a revenue estimate projected by the Oregon Bankers Association, which is supporting the tax bill.
"Our internal revenue estimate is between $4.5 to $6 million," said Thomas Perrick, president of the bankers group, of the proposal that would hit 12 state charters over $100 million in assets. The bankers and credit unions are still awaiting an official cost estimate by the state budget office on the credit union tax. Perrick said he is not daunted by a looming April 11 deadline by which the bill must be heard in committee or die. "I'm really not worried," he told The Credit Union Journal. "I'm confident it will be heard." Meantime, the possibility exists that the bankers will try to attach the tax bill to the pending bill, scheduled for a vote by the Senate last Thursday, to allow municipalities to deposit funds in credit unions.
Texas CU Reform Moves Ahead
AUSTIN, Texas-State chartered credit unions here would be allowed to offer secondary capital and to acquire a bank under a credit union modernization bill that passed the House Financial Institutions Committee last week. The bill, now headed to the House floor, would also allow credit unions to: offer check cashing and wire transfers to non- members within their fields of membership (FOM); allow low-income credit unions to accept secondary capital and non-member deposit accounts; provide parity for out-of-state credit unions operating in Texas; update allowances for electronic voting and expelling members; and require quarterly call reports for all credit unions. Texas CU League President Dick Ensweiler said he believes the prospects are good for the measure. "We think it has a good chance of passing," he told The Credit Union Journal.
CUNA Lobbies For Tax Exemption For CU Dividends
WASHINGTON-CUNA called on Congress Wednesday to include in its economic stimulus package a limited income tax exemption for credit union dividends (interest). In a letter to House and Senate leaders, CUNA President Dan Mica said the exemption would help boost savings and investment through both traditional deposit accounts and fixed-income instruments. Mica noted that a limited exemption for both dividends and interest was provided prior to the 1986 Tax Reform Act. "CUNA would enthusiastically support reinstatement and an increase in the amount of this exclusion as it would promote economic growth by increasing savings and investment while putting additional dollars in the hands of consumers," Mica said in the letter.
House Boosts Deposit Insurance Coverage
WASHINGTON-The House overwhelmingly approved a bill Wednesday to reform the deposit insurance reform system which would raise the coverage on all federally insured credit union accounts to $130,000, from the current $100,000. The bill would also double the coverage on retirement accounts to $260,000. The measure would also merge the Bank Insurance Fund with the Savings Association (S&L) Insurance Fund, something Congress has been trying to do for more than a decade. The bill now goes to the Senate.
Teller Stunned During CU Hold-Up
CRESTON, Wash.-A teller at Coulee Dam FCU was left immobilized last week when two assailants, one dressed in drag, entered the credit union and shot her with a stun gun before robbing the credit union. The hold-up occurred around 10 am last Friday when one of the me, dressed in women's clothing and a wig, knocked on the door and asked the lone teller to open the door. When she opened the door the assailant grabbed the teller from behind and shot her with the stun gun. A second robber then entered and the two tied up the teller with duct tape then fled with an undisclosed amount of cash.