Banking news roundup, April 28, 2023

NCUA files charges against former credit union CEO

The National Credit Union Administration has filed numerous charges with the United States Office of Financial Institution Adjudication against the former chief executive of Edinburg Teachers Credit Union in Edinburg, Texas. Jeffrey B. Moats, who joined the credit union as CEO in 1995, allegedly directed ETCU staff to use credit union deposits as funding for his retirement account, unapproved retention bonuses, payouts for unused vacation time and car insurance premiums. The NCUA is seeking restitution of at least $4 million for the credit union and a $1 million civil penalty. —Frank Gargano

During crisis, Home Loan bank advances rose to record $1 trillion

Outstanding loans by Federal Home Loan banks to financial institutions surged to a record $1 trillion during March's banking crisis, even as the pace slowed at the end of the month. The loans, which are known as advances, jumped 28% at the end of the first quarter from the close of 2022, the FHLB Office of Finance said on Friday. The increase was "driven by continued demand by depository members for liquidity," according to a statement. Despite reaching an all-time high, the figure is below what some analysts had anticipated. It's a signal that lenders' rush to get cash to pay fleeing depositors might have faded, and that the worst of the stress in March may have abated. The data reflects lending as of March's end, so the uptick in Home Loan bank financing sparked by the shaky status of First Republic Bank isn't reflected. — Bloomberg News

First Internet Bank names its first chief people officer

First Internet Bank in Fishers, Indiana, appointed its first chief people officer on Tuesday. In that role, Lorraine Ortiz (pictured above) will lead diversity and inclusion initiatives, among other human resources programs. Most recently, she was chief human resources officer at Butler University in Indianapolis. "Her expertise in leading human resources teams and her strong advocacy for employees will be invaluable as we continue to build a world-class financial institution," said Nicole Lorch, president and chief operating officer of the $4.7 billion-asset bank. Ortiz is the first Hispanic woman to join the C-suite at First Internet. —
Miriam Cross

U of IL Community Credit Union acquires deposits from CIBM Bank

University of Illinois Community Credit Union in Champaign has agreed to acquire certain consumer deposits from the $745 million-asset CIBM Bank's branch in Danville, Illinois. The $591 million-asset credit union said it will assume most consumer deposits, including certificates of deposit, money market accounts, individual retirement accounts and some checking and savings accounts associated with the branch. The transaction is expected to close in the second quarter of 2023. As of Dec. 31st, 2022, the retail deposit balances at the CIBM Bank branch in Danville were approximately $29 million. — Ken McCarthy

UBS hires trio of Barclays bankers in U.S. investment banking push

In a push to expand its U.S. investment-banking offerings, UBS hired Marco Valla as co-head of the global-banking division, alongside Javier Oficialdegui. Valla replaces Ros L'Esperance, who will create a new corporate advisory group. The move comes a month after UBS agreed to purchase Credit Suisse. "The acquisition of Credit Suisse, together with our previously approved investment plans, provides us with an unparalleled opportunity to expand the size and scope of our global-banking footprint, particularly in the Americas," Rob Karofsky, president of UBS's investment bank, said in a memo to staff. Jeff Hinton, most recently co-head of the Americas mergers and acquisitions business at Barclays, and Kurt Anthony, a managing director in Barclays's consumer-retail group, will also join UBS. —Jenny Surane, Blooomberg News

Seattle Bank's CD Valet site expands nationwide

CD Valet, a website built by Seattle Bank to counter the influence of pay-to-play comparison sites like Bankrate and NerdWallet, is now available nationwide. The consumer website collects certificate of deposit rates of banks and credit unions and does not accept advertising dollars to push certain choices to the top. When it launched in November, it featured insured banks that were chartered in five Western states or had a presence of five or more branches in those states, as well as financial institutions that met certain other criteria. It now features banks and credit unions in all 50 states. — Miriam Cross