Home Info Newsroom CURRENT Newsletter CURRENT Newsletter | 12 February 2021

CURRENT Newsletter | 12 February 2021

Share Your News!

We appreciate our loyal readers! Please send your comments and feedback to pr@vacul.org.

Headlines

Pandemic Response

Compliance / Regulatory Affairs

Financial Services / Economy

Headlines

Political insiders Chris Christie, Rahm Emanuel to Speak at CUNA GAC

CUNA announced former Governor Chris Christie and former Mayor Rahm Emanuel will join this year’s CUNA Governmental Affairs Conference (GAC), March 2-4, for a lively point/counterpoint discussion tackling some of the issues driving Washington today, and how they’re likely to affect the communities and people credit unions serve. This keynote session is sponsored by CUNA Mutual Group.

“In today’s dynamic and highly partisan environment, we need to hear from leaders on both sides,” stressed Todd Spiczenski, Chief Products Officer at CUNA. “Chris and Rahm bring invaluable insights that will inform the system’s efforts and I have no doubt it will be a lively and thought-provoking discussion.”

Learn more

Related: Small Credit Unions: CUNA Mutual Group Providing 13 GAC Scholarships

CUNA Mutual Group Hosts Office Hours: Cybersecurity Webinar Feb. 17

CUNA Mutual Group invites you to connect with their Risk Consultants, risk and insurance partners, and your credit union peers to ask questions regarding the latest risks, loss trends, and mitigation tips related to cybersecurity.

The hour-long webinar is slated for Feb. 17 at 2 p.m.

Learn more | Register

FISERV Hosting Free Webinar Feb. 25 on Fraud Trends

As 2021 begins to take shape, the pandemic has seen consumers move to and embrace e-commerce channels. As the payment shift continues, what are the impacts to fraud and what can credit unions continue to do to mitigate their risk? FISERV, your partner in payments, will continue its exploration into fraud trends that matter to your credit union during our Feb. 25 webinar.

Start time for the free, hour-long webinar is 10 a.m.

Register here

League Hosting Compliance, Regulatory Update Webinar March 17

Join us March 17 for a free compliance/regulatory update with attorney Jay Spruill. The hour-long webinar (10 a.m. start time) will cover frequently asked questions on the League compliance hotline, key federal regulatory issues, and any recently enacted state laws that might affect your operations.

Also, feel free to send your questions prior to the webinar to your League’s Mary Amyx at mamyx@vacul.org. She’ll gladly forward them to Jay to ensure they are covered during the webinar.

Learn more and register here.

Defense Credit Union Council Hosting Advocacy Webinar Feb. 25

Defense Matters is going online this year! Because the health and safety of our DCUC staff and members is our highest priority, Defense Matters 2021 will be presented in a webinar format this year.

This Feb. 25 webinar will focus primarily on Advocacy and Legislative topics specific to Defense Credit Unions and the military populations they serve. The goal is to equip members with the best and most current information to address issues regarding the financial well-being of Service members, their families, and Veterans.

Every credit union has a military member. Come learn how you can better advocate for them and their financial needs!

Learn more

Pandemic Response

Moratorium on Evictions, Foreclosures of FHA-Backed Mortgages Is Extended Again; FHFA Estimates Costs to Reach $2 Billion

The Federal Housing Finance Agency (FHFA) has again extended its moratorium on foreclosures and evictions, this time through March 31. The policy applies to government-sponsored enterprise (GSE)-backed single-family mortgages and GSE-owned properties.

The extension comes as more than 1.5 million mortgages in forbearance are set to expire in the coming months, as CUToday.info reported here.

In addition, the FHFA announced that borrowers with a GSE-backed mortgage who are on a COVID-19 forbearance plan as of Feb. 28, 2021, may be eligible for an additional forbearance extension of up to three months.

COVID-19 Payment Deferral for borrowers with a GSE-backed mortgage can now cover up to 15 months of missed payments, the FHFA also announced in the release. COVID-19 Payment Deferral allows those borrowers to repay their missed payments at the time the home is sold, refinanced, or at mortgage maturity.

The FHFA is projecting the foreclosure and eviction moratoriums will cost the GSEs as much as $2 billion. The agency in December began implementing a 0.5% adverse market refinance fee on GSE-backed mortgages as a way to protect the GSEs from losses.

Learn more

SBA Working to Enhance PPP Access

The U.S. Small Business Administration is working to increase equitable Paycheck Protection Program access to underserved small businesses and improve the speed with which it is resolving data mismatches and eligibility concerns.

The agency reported that it has approved $103 billion of PPP loans to over 1.4 million small businesses. Almost 82% of PPP funds have gone to businesses that requested loans of less than $100,000, while 28% of businesses that received funding in the latest round are in rural areas, according to the SBA.

Meanwhile, PPP lending rose considerably in week three of the newest version of the PPP. The latest report showed that 891,0444 loans totaling $72.74 billion had been approved between the program's Jan. 11 relaunch and Jan. 31.

Demand for second-draw loans far outpaced first-draw loan demand through Jan. 31. The SBA approved 664,708 second-draw loans totaling $67.95 billion, compared to just 226,336 first-draw loans worth $4.79 billion. (S&P Global Market Intelligence,Feb. 11)

Related: Fed’s aid program for midsize businesses spent only 3% of its total

Compliance / Regulatory Affairs

Chartering Manual Proposal Would Help CUs Deliver Necessary Services

NCUA’s proposal would update the chartering manual’s service facility requirements which would help credit unions deliver necessary financial services to Americans and has CUNA’s strong support. The proposal would include any shared branch, ATM where the credit union is a member of the network, or electronic facility in the definition of “service facility” for a federal credit union adding an underserved area.

“The proposed rule would make common sense changes to service facility requirements and reduces regulatory burden and confusion by harmonizing requirements for multiple common bond (MCB) credit unions for group and underserved area additions,” the letter reads, also noting that the proposed changes simplify requirements while adding necessary flexibility needed for credit unions to serve underserved areas.

Learn more
Related: CUs, Bankers Credit Unions Fighting Again Over FOM Rules
Related: NCUA's Next FOM Fight is Already Brewing (American Banker subscription may be required.)

Future NCUA Rulemaking Remains Unclear

As the rulemaking process continues, NCUA officials could not give a timeframe Wednesday for when, or if, the agency board will finalize controversial rules initially considered by the board during the past two months.

During a webinar held by the agency to discuss new board Chairman Todd Harper’s priorities, Harper did not address those proposals, several of which he opposed when they were first brought to the board.

Comments are being evaluated on some proposals, such as changes to the agency’s field of membership and CUSO rules, NCUA General Counsel Frank Kressman said during the webinar.

Harper opposed those rules, while Hood and Republican Kyle Hauptman supported them. The two GOP members still may be able to force the board to consider them, despite the chairman’s opposition.

Kressman also said his office must evaluate comments on a proposal dealing with capitalization of interest before it can be presented to the board as a final rule.

Some proposed rules have not even been published in the Federal Register yet — the first step in the rulemaking process. Kressman said that the Federal Register has been “slammed” by a huge number of agencies seeking to publish documents, so there is a backup in the publication of rules.

Learn more

Final Joint Ownership Share Accounts Rule on NCUA’s Feb. 18 Agenda

NCUA will vote on a final rule on joint ownership share accounts at its February 18 board meeting, according to the agenda released Thursday. This will be the first meeting with Todd Harper as NCUA chairman.

CUNA supports the joint ownership proposal, as it helps maintain parity with regulations that apply to banks. The rule would explicitly permit the use of other evidence contained in a credit union’s account records to satisfy the signature card requirement for joint ownership of share accounts.

Acting CFPB Head Calls Out Industry for Slow Complaint Response Times

The new interim leader of the Consumer Financial Protection Bureau pledged to take action against firms that are slow to respond to customer complaints during the pandemic.

Consumers submitted 42,774 complaints to the CFPB portal in April 2020 as COVID-19 was spreading, the highest monthly tally ever. The CFPB received 187,547 complaints from Jan. 1, 2020 to May 31.

But in a blog post, acting CFPB Director Dave Uejio expressed concern that financial institutions have dragged their feet in addressing complaints, and said the agency was working on an upcoming report highlighting response issues. The bureau typically requires a financial company to respond to the consumer within 15 days of a complaint. (American Banker, Feb. 10)

Financial Services / Economy

Fed Chair: Unemployment Rate was Closer to 10 Percent, Not 6.3 Percent, in January

Federal Reserve Chair Jerome H. Powell said Wednesday that the unemployment rate in January was “close to 10 percent,” significantly higher than the 6.3 percent rate reported by the Labor Department last week.

The discrepancy is partly due to many unemployed Americans being misclassified as employed, Powell said during a virtual speech at the Economic Club of New York. After accounting for people who have left the labor force since February 2020 and other factors, the unemployment rate is much higher than the official figure, he said.

Learn more (Washington Post subscription may be required.)
Related: With Biden going big, Wall Street economists are growing bullish on the US economy

Survey Reveals a Hidden Consumer Exodus Going on in Banking

Consumers are not moving primary accounts to new competitors in droves (yet) but a major research study finds that people are quietly, and increasingly, purchasing profitable ancillary products from someone other than their primary institution. A better and more efficient marketing and sales process could help slow the flow.

Transaction account data often can pinpoint defections of consumer deposits into someone’s mutual fund or another institution’s CD, but it’s harder to know when one of your checking customers decides to take out a loan or a credit card with another financial institution. Turns It turns out more people are doing that.

As consumers have become more comfortable doing things digitally — especially since the start of the pandemic — the friction that used to hold people back from buying financial products at a competitor has all but disappeared. It doesn’t help that the new crop of digital-only financial institutions tends to compete on both price as well as ease and speed of application.

Learn more

 



« Return to "CURRENT Newsletter" Go to main navigation