News Now Archive

Published on January 3, 2013.

Cheney identifies 2013 action agenda

WASHINGTON (1/3/13)--Credit Union National Association (CUNA) President/CEO Bill Cheney Wednesday named the top priorities that will drive CUNA's action agenda in 2013.
 
"CUNA's 2013 priorities fall into three key categories: Protecting credit unions, easing their regulatory burden, and helping them prepare for the future," said the CUNA leader.
 
"Protecting the credit union tax exemption tops our list of ten 2013 priorities for good reason," Cheney said. "It is widely expected that comprehensive tax reform will be on the legislative agenda next year.
 
"As part of that process, the credit union tax status is likely to be examined and could come under significant threat--particularly since we know the banks will continue their paid media and lobbying barrage urging credit union taxation." (See related story: A closer look: CUNA sets four-pillar legislative agenda.)
 
Here is CUNA's list of top ten priorities for the year:

Starting with today's issue, News Now will feature an in-depth look at certain CUNA 2013 priorities.  Today's issue discusses legislative priorities in "A closer look: CUNA sets four-pillar legislative agenda." The Jan. 7 edition will feature details on CUNA's regulatory priorities. Additional features will follow.
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A closer look: CUNA sets four-pillar legislative agenda

WASHINGTON (1/3/13)--The Credit Union National Association (CUNA) will explore every option and take every opportunity to represent credit unions on Capitol Hill in 2013, said CUNA President/CEO Bill Cheney Wednesday as he unveiled CUNA's 2013 legislative priorities.
 
"It's time to take our substantial 2012 successes and continue to build a great future for credit unions," Cheney declared.
 
A key issue on CUNA's 2013 legislative priorities agenda is the preservation of the credit union federal tax status. The tax status is likely to be examined this year as the 113th U.S. Congress scrutinizes comprehensive tax reform. (See related story: Cheney identifies CUNA 2013 action agenda.)
 
Overall, the CUNA legislative agenda this year will have four pillars:  preserving the credit union tax status; reducing regulatory burden; engaging in housing finance reform; and advancing credit union charter enhancements, such as increased member business lending authority and supplemental capital.
 
The statutory credit union tax status provides credit unions with an exemption from federal income tax because of their cooperative business structure. CUNA and the state credit union leagues are prepared to wage a public advocacy campaign in support of current law. It will encompass a comprehensive and deliberate grassroots, communication and legislative strategy.
 
CUNA has always maintained that the statutory tax status is as relevant today as it was when granted. In 1917, the U.S. Attorney General--and later the U.S. Congress--exempted credit unions from a federal income tax obligation because of their organization structure: Credit unions are member-owned, not-for-profit financial cooperatives.
 
The exemption, in effect since credit unions' inception in the United States, has been reaffirmed many times, including in 1935, 1936, 1937, 1951 and 1998.
A second pillar of the CUNA legislative agenda: To address what CUNA has come to call the "crisis of creeping complexity" with respect to regulatory burden.
 
This is an area in which CUNA had a series of victories in 2012.  Despite the gridlock that gripped Washington throughout the year--right up to and through the "fiscal cliff" negotiations this week--CUNA was able to secure a number of regulatory relief measures. Some examples include:

The remaining two of CUNA's four legislative pillars are engaging in housing finance reform and advancing charter enhancements.
 
Working with its Housing Finance Reform Task Force, CUNA is prepared to deeply engage with Congress' efforts to reform Fannie Mae and Freddie Mac, expected to be a top priority of House Financial Services Committee Chairman-designate Jeb Hensarling (R-Texas).
 
CUNA will continue to pursue charter enhancements that improve the operating environment for credit unions. Two major initiatives that remain as priorities from 2012 are supplemental capital and increased member business lending.
 
For supplemental capital to advance, CUNA and the leagues will continue to educate and generate support for the issue within the credit union system and raise it in the context of Congress' consideration of bank capital issues, such as Basel III rules. 
 
In 2012 CUNA supported H.R. 3993, which would modify the definition of credit union net worth to include supplemental forms of capital for credit unions. It was referred to the House Financial Services subcommittee on financial institutions and consumer credit for consideration.
 
CUNA and the leagues also will work to continue progress of legislation in both the House and Senate that would increase the credit union member business lending cap to 27.5% of assets, up from 12.25%. MBL bills (H.R. 1418/S. 2231) enjoyed strong support in both chambers with 145 backers in the House and 22 in the Senate.  
 
In 2013, CUNA intends to seek the reintroduction of legislation in both chambers to permit experienced credit unions to continue to lend to their small business members. (See related story: CUNA, leagues are active as 113th Congress begins.)
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With banner 2012, CULAC looks forward

WASHINGTON (1/3/13)--The Credit Union Legislative Action Council (CULAC) had a banner year in 2012, raising more than $2 million to support credit union-friendly candidates, Credit Union National Association (CUNA) Senior Vice President of Political Affairs Richard Gose reported Wednesday. CULAC is CUNA's political action committee (PAC).

The $2 million funding total is the largest single-year total recorded by CULAC, and it shows that credit union supporters nationwide are "fired up and ready to support credit union candidates," Gose said. CULAC raised a total of $3.93 million in 2011 and 2012, combined, for the two-year election cycle.

Gose said CULAC aims to maintain its growth momentum going into the next electoral cycle. CULAC's goal is to have more resources for its independent expenditures and partisan communications going forward, he added.

Altogether, CUNA, CULAC and state credit union leagues spent $4.15 million to support pro-credit union candidates in the 2012 federal elections. Nearly $1 million of those funds went to independent expenditures leading up to the November elections, and CULAC spent $3 million on candidate contributions. CUNA and leagues also spent more than $300,000 in additional funds to support partisan communications.

CUNA and CULAC supported candidates in 361 U.S. House races and 33 U.S. Senate races, and in 96% of those races the credit union-friendly candidates won.

CULAC was the most bipartisan PAC in opensecrets.org's list of the top 20 PAC contributors for the 2012 elections, with funding nearly evenly divided between the two major parties.

Advocacy efforts made in 2012 took on several forms, including radio advertising, direct mail, and CUNA's first forays into new media political advocacy. These new media efforts included demographically targeted online advertising on web-based media platforms such as social media site Facebook, online radio site Pandora, and banner or sidebar ads on various websites. Candidates also received search-based advertisement placement through Google's AdWords product.

Dan Maffei (D-N.Y.), Chris Collins (R-N.Y.) and Iowa candidate Kristie Vilsack (D) received the new media support, and while these online projects represented a small portion CUNA's overall independent expenditure budget, "they were another worthy avenue to educate voters and mobilize and activate supporters for our candidates," CUNA Vice President of Political Affairs Trey Hawkins said.

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NCUA to offer Jan. 24 HMDA webinar

WASHINGTON (1/3/13)--Ways to avoid common errors found on Home Mortgage Disclosure Act (HMDA) Loan Application Register (LAR) forms, form preparation tips, and management issues impacting credit unions that file the LARs will all be addressed during a Jan. 24 National Credit Union Administration (NCUA) webinar.

The webinar, entitled "HMDA: Accuracy and Timeliness," is scheduled to begin at 2 p.m. ET on Thursday, Jan. 24.

The NCUA Office of Consumer Protection will join Federal Reserve Board experts during the webinar to:

The NCUA is accepting questions ahead of the webinar. Questions can be submitted to WebinarQuestions@ncua.gov. The agency asks that participants use "HMDA Webinar" in the subject line of their submitted questions.

To register for the webinar, use the resource link.
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CUNA seeks comment on recent remittance changes

WASHINGTON (1/3/13)--The Consumer Financial Protection Bureau (CFPB) late last month unveiled a series of revisions to its still-pending remittance regulation proposal, and the Credit Union National Association (CUNA) is seeking credit union comment on these changes through a new online survey and a comment call.

The recent remittance rule revisions are slight tweaks to CFPB-proposed remittance regulations.

The CFPB said the revisions would:

These changes were among the revisions urged by CUNA in several meetings with the bureau.

The CUNA survey and comment call follow up a September CUNA release that sought comment on the broader CFPB remittance proposal. Deputy General Counsel Mary Dunn said CUNA took the unusual step of releasing a second comment call and survey due to the tight comment deadline the CFPB has imposed.

The agency is accepting comment on the remittance implementation period changes until until Jan. 15, and is accepting comment on the broader CFPB revisions until Jan. 30.

CUNA has asked credit unions to complete the remittance survey and respond to the Comment Call by Jan. 22. CUNA asks for comment on the delayed effective date by Jan. 11.

For the remittance survey and comment call, use the resource links.
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CUNA, leagues are active as 113th Congress begins

WASHINGTON (1/3/13)--The 113th U.S. Congress officially begins today as members are scheduled to be sworn in this afternoon, and the Credit Union National Association (CUNA) and state credit union leagues are already in action, welcoming new members and advocating for key credit union priorities as the 2013 legislative calendar begins.

CUNA representatives and members of credit union leagues from Missouri, North Carolina, Ohio, Texas and Kentucky will attend legislator open houses and swearing in ceremonies this week.

Organizational resolutions and other official business will likely be the only actions taken by the 113th Congress this week, and both the House and Senate are expected to be out of session next week. Both chambers are expected to return to work following the inauguration of President Barack Obama on Jan. 21.

There will be 14 new senators and 84 new House members in the new Congress. Some of the newly elelcted members of Congress incorporated increasing credit union member business lending (MBL) authority and other key credit union issues into their campaign platforms. Overall, the Credit Union National Association (CUNA) supported 388 candidates for the House and Senate in November's election, and in 96% of those races the credit union-friendly candidates won.

The return and influx of credit union-friendly candidates could boost MBL legislation progress during this session of Congress, said CUNA Senior Vice President of Political Affairs Richard Gose.

CUNA, the state credit union leagues, credit unions and members of Congress late last year backed MBL cap increase legislation as a way to help small businesses. House (H.R. 1418) and Senate (S. 2231) MBL bills gained strong support, earning 145 and 22 backers, respectively. Both bills will need to be reintroduced in this Congress.

The MBL bills would increase the 12.25%-of-assets credit union member business lending (MBL) cap to 27.5% of assets. CUNA has estimated that the proposed MBL cap increase could inject $13 billion in funds into the economy, creating as many as 140,000 new jobs in the first year following enactment.

Maintaining the credit union tax status, addressing housing finance reform issues, decreasing regulatory burdens faced by credit unions and increasing credit union access to supplemental capital are other key items for CUNA and credit unions during this session of Congress. (See related story: CUNA sets four-pillar legislative agenda for 2013.)

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Senate confirms Treasury OFR director

WASHINGTON (1/3/13)--The U.S. Senate this week confirmed Richard Berner to serve a six-year term as the U.S. Treasury's first Office of Financial Research (OFR) director.

Credit Union National Association (CUNA) Deputy General Counsel Mary Dunn said CUNA plans to meet with Berner soon.

Berner was approved by a voice vote on Jan. 1. He has served as Counselor to the Secretary of the Treasury since April 2011, helping Treasury Secretary Tim Geithner set up the OFR.

The OFR was set up under the Dodd-Frank Wall Street Reform Act and is charged with helping regulators avoid any future systemic crisis by measuring risk and monitoring how the financial system is evolving.

Geithner on Wednesday said Berner has been instrumental in laying the groundwork for the OFR to support Wall Street reform, including improving financial data and serving the Financial Stability Oversight Council.

The OFR held its inaugural advisory committee meeting last month. In that initial meeting, the committee asked financial industry players how it can improve collection and analysis of financial data to detect systemic threats.

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Inside Washington

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What's in store for CUs in 2013

MADISON, Wis. (1/3/13)--Credit unions enjoyed a wave of positive publicity, popularity with consumers, record growth and a strengthening of political clout during 2012. That doesn't mean they can sit back in 2013 and ride on the coattails of last year's successes.
 
News Now checked a variety of resources to find out what they are predicting for this year and picked the predictions that seemed to have the most consensus.

This year likely will bring renewed challenges to credit unions' tax status, more credit unions edging closer to their member business lending caps, and the challenges of complying with more extensive regulations. But they also face operational challenges--and opportunities--regarding operating in a near-zero interest-rate environment during a make-or-break year for the economy; technological issues related to mobile banking and the threats to the security of members' data; and marketing challenges in a diverse world.
 
Here's what to watch for in 2013:

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CUs' rates get nod from CBS News, other media

MADISON, Wis. (1/3/13)--Credit unions' rates on saving, checking and auto financing got nods from several media reports, including CBS News'  MoneyWatch,an article on checking accounts in The Gainesville Sun that featured Credit Union National Association (CUNA) President/CEO Bill Cheney, and The Cincinnati Enquirer.
 
CBS News' article, "13 money tips for 2013," featured credit unions in Tip No. 3. "Earn more on your safe money" (Dec. 31).
 
"Sure, interest rates are low, but with a little work you can squeeze out some extra money," the article said. It advised, among other things, to "shop around at credit unions that offer better interest rates than most banks."
 
The Gainesville Sun article, "Need a new checking account?" (Jan. 2) noted statistics from financial data publisher Bankrate, stating the average monthly service fee on checking accounts that don't pay interest is a record $5.48--a 25% increase over last year's average fee.
 
Among the tips: "Consider credit unions."  CUNA's Cheney explained in the article that "Most people qualify to join a credit union; you just have to find one you qualify for." The article pointed readers to ASmarterChoice.org to locate a credit union, and cited a report from CUNA in March than showed credit unions "also have more favorable interest rates on their savings accounts and loans. Interest on a savings account at a credit union averages 0.20% and 0.15% at regular banks." It also noted credit unions' large ATM networks are comparable to big banks' networks.
 
In addition, the Gainesville article quoted financial planner Kevin Kautzmann of EBNY Financial in New York, who said that all his clients who switched to credit unions had nothing but good things to say about them. 
 
Most credit unions offer truly free checking accounts, meaning you won't have to maintain a balance or sign up for direct deposits to avoid a monthly fee, the article said.
 
The third article, "Be careful when looking into auto financing," was published Wednesday in The Cincinnati Enquirer and written by Howard Ain, a consumer complaints ombudsman on WKRC-TV. Ain told of  a woman who received a letter from a company claiming it could refinance her vehicle with a rate as low as 3.99%. However, the interest rate quoted her after she applied was higher.
 
"While the deal would still save her money, I suggested she first check with her local credit union. She found a nearby credit union and was told if she joins, for just a few dollars, she could get a loan with an even lower interest rate."
 
"Bottom line, if you've got an auto loan with a high interest rate, it could pay you to contact a credit union and see if you qualify for a lower rate. These are very unusual times with record low interest rates and, if you qualify, you could save yourself a lot of money," Ain advised.
 
To read the full articles, use the link.

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Top 10 News Now stories for December

MADISON, Wis. (1/3/13)--An article advising users that no sensitive personal information from cuna.org was accessed or compromised in a hacking attack was the most read News Now story in December.
 
The top 10 articles in December included:
 
10. Passage of CUNA-backed ATM bill means relief for CUs
 
WASHINGTON (12/12/12)--Tuesday's unanimous consent passage of a bill removing duplicative ATM disclosure requirements "represents a substantial realization of regulatory relief that will have an impact on every credit union that owns an ATM--while having no adverse effect on consumers," Credit Union National Association (CUNA) President/CEO Bill Cheney said. CUNA strongly backed the bill.
 
9. CUNA action call urges CUs to oppose TAG bill

WASHINGTON (12/6/12)--In a new call to action, CUNA is encouraging its member credit unions and leagues across the country to contact and urge their senators to oppose legislation that would extend for banks the Transaction Account Guarantee program.
 
8. Appeals court issues ruling in Wells Fargo overdraft case

SAN FRANCISCO (12/28/12)--The U.S. Court of Appeals for the Ninth Circuit has reversed in part a lower court's order requiring Wells Fargo Bank to cease charging overdraft fees based on its posting debit-card transactions in high-to-low order.
 
7. Beware of hotel room security threat
 
NEW YORK (12/18/12)--Thieves have developed a simple device that can unlock room doors at some of the most popular hotel chains, potentially putting you and your belongings at risk (NBC Today: Rossen Report Dec. 6).
 
6. Arkansas, Oklahoma, Texas leagues intend to consolidate
 
FARMERS BRANCH, Texas (12/17/12)--The boards of the Arkansas Credit Union League, the Credit Union Association of Oklahoma and the Texas Credit Union League announced today they intend to pursue consolidation into a single regional league operating as Cornerstone Credit Union League.
 
5. CFPB proposes remittance changes, delayed effective date
 
WASHINGTON (12/21/12)--The Consumer Financial Protection Bureau on Friday released proposed revisions to its pending international remittance regulations that agency director Richard Cordray said "will ensure consumers have continued access to remittance transfer services while making compliance easier for remittance transfer providers."
 
4. CUs do it right (again) in satisfaction survey
 
BOSTON (12/19/12)--U.S. credit unions continue to achieve much higher satisfaction and advocacy rates compared to large regional and national banks, according to results announced Tuesday of the 2012 ath Power Ideal Banking Study, which assesses the retail member/customer experience at credit unions and banks nationwide.
 
3. TAG bill defeated in Senate
 
WASHINGTON (12/13/12)--Today's defeat of a Transaction Account Guarantee (TAG) extension on a budget point of order is a "death blow" to the legislation and a significant victory for the Credit Union National Association (CUNA), credit unions and state leagues across the country that aggressively opposed this bank bailout program, CUNA President/CEO Bill Cheney said.
 
2. President signs ATM signage bill, CFPB privacy
 
WASHINGTON (12/20/12)--President Barack Obama Thursday afternoon signed a bill (H.R. 4367) into law that revises Regulation E to require ATM fee disclosures only need to be presented on an ATM's screen. The new law eliminates a duplicative provision that required a physical notice also be posted on the ATM, a requirement that has created legal and financial issues for some credit unions and other financial institutions.


1. CUNA notifies website users of broad hacking attack
 
WASHINGTON and MADISON, Wis. (12/11/12)--CUNA is advising thousands of users of its website that no sensitive personal information from cuna.org was accessed or otherwise compromised in a hacking attack that--in addition to CUNA--also affected 30 or more additional organizations, U.S. government agencies, industry and other trade associations.

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Maryland CU focuses on credit card growth

GERMANTOWN, Md. (1/3/12)--When it expanded its membership in 2011 to include more local employee groups, Montgomery County Employees FCU identified credit cards as the best opportunity for membership growth, according to James Norris, the credit union's CEO.
 
In a survey of its membership, the $90 million-asset credit union, of Germantown, Md., found that many members held cards with larger issuers.
 
"Credit cards are closely tied to member relationships," Norris said. "If you get the credit card relationship, you are more likely garner more accounts."
 
To spur growth, Montgomery County Employees FCU ran a 0%, 12-month introductory rate on balance transfers. The credit union used Georgetown Cupcakes, a popular in the Washington D.C-area sweets shop with its own TV show, to promote the initiative.
 
The credit union handed out cupcakes at the Montgomery County government cafeteria, and the county sent out e-mails to its 9,000 employees promoting the event. A promotional flyer included a cupcake with a "0" candle.
 
"Around here if you say Georgetown Cupcakes, you are going to get a lot of attention," Norris said.
 
The attention helped the credit union increase its credit card portfolio 53% from June 2011 to June 2012 and 19% from June 2010 to June 2011. That ranked it seventh nationally in percentage of growth according to Callahan's Research.
 
The credit card growth also helped the credit union grow in other areas, said Norris. The credit unions increased its mortgage portfolio 119% from 2011 to 2012, ranking 20th nationally in percentage of growth, the research found.
 
The credit union also increased its overall membership roughly 3% from 2011 to 2012, which was more than it had projected.
 
The credit union has plans to add a rewards component to its credit cards program.
 
"Looking at the survey, our members have rewards with other institutions, so it's very important for us to get a rewards program out there," Norris said.
 
The program will include travel, cash back and merchandise," Norris said
 
"We want to make it valuable for our members and allow us to compete with the larger issuers," he added.

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Pa. foundation: A record year in grants, fundraising

HARRISBURG, Pa. (12/3/13)--The Pennsylvania Credit Union Foundation enjoyed a record year of unrestricted fundraising and providing grants awards during 2012.
 
Foundation Chairman Ray Brunner and Vice Chairman Dave Ackerman reported that grant awards in 2012 totaled $151,620, a 20% hike over the $126,358 in awards granted in 2011. Unrestricted funds, or funds that are not earmarked for a specific project, raised totaled $266,062, or 23% more than 2011's $216,404 raised, reported the Pennsylvania Credit Union Association newsletter, Life is a Highway (Jan. 2).
 
In addition, a restricted Project Haiti program, which will be implemented this year, attracted $23,575 in pledges from 25 credit unions in the state.
 
"Favorable publicity generated from a joint association/foundation flood relief program in 2011 attracted large support from credit unions in affected areas of eastern Pennsylvania," said Brunner.
 
Ackerman credited "successful reality fairs in Philadelphia and western Pennsylvania as factors behind the impressive fundraising totals from credit unions and vendors, who not only contributed financial support but also shared in the implementation of these types of projects in schools."
 
The foundation said that during 2013, it would continue to implement projects that benefit small credit unions and provide financial literacy to schools throughout Pennsylvania.

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CU System briefs

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Market News

MADISON, Wis. (1/3/13)
 

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News of the Competition

MADISON, Wis. (1/3/13)

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Claim saver's tax credit for 2012

WASHINGTON (1/2/13)--If you're a low- or moderate-income worker saving for retirement in a 401(k), an individual retirement account (IRA) , or similar workplace retirement program, you could be eligible to claim a special tax credit of as much as $1,000 for individuals and $2,000 for married couples  (U.S. News & World Report Dec. 20).
 
You can claim this credit in addition to any other tax savings you get for your retirement account contributions.
 
Here are the rules to claim this credit on your 2012 tax return:

Note that you can't take the 2012 credit if you were enrolled as a full-time student during the calendar year or if someone else will claim you a dependent.
 
The saver's credit is highest for retirement savers with the lowest incomes. The credit ranges between 10% and 50% of retirement contributions, with the highest percentage going to savers with the lowest incomes.
 
If you were unaware of this credit, first introduced as a temporary provision in 2002 and made permanent in 2006, you're not alone: Only one of four workers has heard about it.
 
You have until April 15 to make qualifying contributions to a new or existing IRA and get the saver's credit on your 2012 tax return. Follow the instructions on IRS form 8880 to figure the saver's credit correctly and claim it.
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CUNA HR/TD Council white paper discusses changing benefits

MADISON, Wis. (1/3/13)--Reduced benefits budgets and shifting costs, the result of increased costs and regulatory changes, have forced organizations to be more creative in offering competitive benefits, according to a new white paper from CUNA HR/TD Council.
 
Trends discussed in the white paper, "Credit Union Benefits Programs: Meet Employees' and Your CU's Financial Needs," include:

The paper also includes three cases studies featuring credit unions that have successfully modified their benefits programs to meet employee needs and credit unions' financial needs.
 
In the paper, Kevin Pailet, senior vice president of Dallas-based Prescott Pailet Benefits, named his five top employee benefits tips. They include:
To download the paper, use the link.
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