CURRENT Newsletter | 15 September 2020
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Headline News
- Last Chance: League Providing Virtual Workshops on IRAs
- Please Report Your Pandemic-Related Efforts to Assist Members
- Boost Your Lending Game: CUNA Mutual Group’s ULEND Academy Set for Nov. 2-6
- Webinar Series for Small CUs
- Virtual Conference for Governance, Risk Management and Compliance Set for Sept. 21-23
- CUNA Backs Legislation to Advance DEI in Financial Services
- Hope Dims for New Pandemic Relief Legislation
- CU CEOs Seek Seat on FHLBank Atlanta
Advocacy / Legislative Affairs
- CUs Best Represented by CUNA/Leagues, Says Independent Study
- Congress Can Prevent a Post-Pandemic Financial Crisis By Addressing CECL
Economy / Financial Services
- CUs Lean on Housing for Loan Growth
- 26% of Americans Have Used Some Type of Payment Deferral Plan
- The Federal Reserve Will Stay on Hold Until 2023, According to CNBC Survey
- It Hasn’t Been This Hard to Get a Mortgage in Six Years
Risk Management
Headline News
Last Chance: League Providing Virtual Workshops on IRAs
This year will see the most significant changes to individual retirement accounts (IRAs) in more than a decade.
Your League is providing a two-day Essentials and Advanced Virtual IRA Workshop on Sept. 22 and 23 from 9 a.m. – 3:45 p.m. each day. This interactive workshop will be led by instructors presenting live with opportunities to pose questions and engage in the discussion.
Please Report Your Pandemic-Related Efforts to Assist Members
We need your help! We appreciate all you’ve done in serving members during the pandemic, as well as your efforts keeping us apprised of your good work. Lawmakers need to know you’re making a difference for members and your communities. To facilitate information gathering on our end, we’ve worked closely with other Leagues to develop a short survey better able to capture information on loan modifications, forbearance, emergency loans, fees waived, etc.
Find the survey here: https://www.research.net/r/CULCOVID630
Please submit your data by Sept. 25. Much of what we’re asking is information you are already compiling and reporting. Your help is appreciated!
Boost Your Lending Game: CUNA Mutual Group’s ULEND Academy Set for Nov. 2-6
Your League is proud to offer CUNA Mutual Group’s popular ULEND Academy Nov. 2-6 as a virtual learning experience for credit union lenders looking for real-world solutions to today’s toughest lending challenges.
The curriculum guides lenders from foundational to advanced skill levels in all lending communication channels and across all stages of the loan process - origination, underwriting, and closing - with cross-selling, consultation, and compliance woven throughout. ULEND Academy is set up as virtual learning workshop within six, 60 to 90-minute daily sessions where participants will discuss, learn, and then apply.
Webinar Series for Small CUs
Start adopting industry best practices to the unique challenges of your small credit union. CUNA-League System Small CU Webinar Series is a new live and recorded webinar series that’s free for CUNA and League members. It runs through Spring 2021.
Get impactful best practices relevant to small credit unions on hot topics, including member experience, digital marketing, lending and more.
See a full list of free webinars and register here.
Virtual Conference for Governance, Risk Management and Compliance Set for Sept. 21-23
Unifying governance, risk management and compliance will be the lead topic at the just-announced CUNA Governance, Risk Management & Compliance Leadership Virtual Conference brought to you by CUNA Compliance & Risk Council with Rochdale Paragon Group, scheduled for Sept. 21-23.This virtual conference covers current information on creating and maintaining a robust credit union governance, risk management and compliance (GRC) program to reduce risk and improve control activities.
CUNA Backs Legislation to Advance DEI in Financial Services
CUNA and its members are committed to ensuring that diversity, equity, and inclusion (DEI) continue to play a meaningful role throughout every aspect of the financial services sector, CUNA wrote to the leadership of the House Financial Services subcommittee on diversity and inclusion Tuesday. CUNA’s letter includes support for several pieces of legislation it believes would advance DEI principles in financial services.
Hope Dims for New Pandemic Relief Legislation
With just three weeks left before the House and Senate recess for the election, prospects for additional coronavirus relief legislation aren't looking good.
“With the Senate’s action last week to reject the targeted COVID bill, I think the prospect of getting a substantial COVID recovery bill through Congress and to the president’s desk before the end of the month…are dim,” Ryan Donovan, chief advocacy officer at the Credit Union National Association, said during a Monday morning press call.
While a comprehensive bill may be unlikely, Donovan said it’s possible the House could bring forward some individual bills related to the pandemic, but most of the focus before the October recess will be on a continuing resolution to keep the government funded until sometime after the election. (American Banker, Sept. 14)
CU CEOs Seek Seat on FHLBank Atlanta
Federal Home Loan Bank of Atlanta (Bank) is conducting an election to fill two member directorships, one independent directorship, and one public interest independent directorship on its board of directors.
Eligible institutions in North Carolina and Virginia will vote to fill the member directorship in their respective state, and eligible institutions across the Bank’s footprint, including Virginia, will vote to fill the independent directorship and the public interest independent directorship.
- Scott C. Harvard, Chief Executive Officer and Director, First Bank, Strasburg, Virginia; Director, Community Bankers Bank, Midlothian, Virginia
Advocacy / Legislative Affairs
CUs Best Represented by CUNA/Leagues, Says Independent Study
CUNA and its League partners are the most influential financial services organization and one of the top ten most effective advocacy organizations in Washington, D.C., according to an independent study conducted by Ballast Research (formally National Journal Research) earlier this year.
For the fifth year in a row, the CUNA-League system earned the distinction as a leading association at representing the interests of its members by creating the credit union narrative and sharing the movement’s story among Washington policymakers.
“The CUNA-League system is as strong as it’s ever been and we are proud to share this moment with the 120 million credit union voices across the nation,” said CUNA president/CEO Jim Nussle. “With competition for awareness on Capitol Hill so fierce during this unparalleled time, that Members of Congress hold us in such is a major accomplishment. As an influential and effective source of information for policymakers, they welcome our calls and visits, and take us at our word as we endeavor to educate and fight for credit union priorities on Capitol Hill.”
Congress Can Prevent a Post-Pandemic Financial Crisis By Addressing CECL
When looking at the astonishing impacts accounting standards have on the U.S. and world economy, everyone would be well served to resist glazing over the rules, and pay close attention to what’s brewing in Norwalk, Conn., where the Financial Accounting Standards Board is headquartered, write Rep. Blaine Luetkemeyer and former FDIC Chairman William Issac in the American Banker.
FASB is a self-appointed private entity operating with impunity and virtually no supervision from Congress or the federal financial regulators. Congress must act soon to ensure the Securities and Exchange Commission and other financial regulators have proper oversight of this powerful, private-sector organization.
Lack of oversight of FASB has resulted in devastating impacts on the nation’s economy in the past and will continue to do so in the future if safeguards are not enacted soon.
FASB’s CECL standard is exacerbating the current downturn and resulting in financial institutions dramatically increasing their reserves, taking billions of dollars out of the economy. This ultimately means consumers and small businesses will have considerably less access to credit. (American Banker, Sept. 4)
Economy / Financial Services
CUs Lean on Housing for Loan Growth
Credit union real estate lending continued its heated growth in July compared with the pre-pandemic July 2019. Even car lending rolled forward, according to CUNA’s latest monthly estimate.
However, the Fed’s G-19 Consumer Credit Report released Tuesday showed the movement’s lending balances on credit cards fell 5.9% to $60.7 billion as of July 31.
Credit unions had been increasing credit card lending at a pace of 6% to 8% last year compared with the same months in 2018. After COVID-19 was declared a pandemic March 11, consumers put a break on spending.
Credit card spending went negative in April, and has been declining by larger percentages each month even as other major segments have improved.
The Madison, Wis., trade group’s Monthly Credit Union Estimates released last week found the nation’s 5,365 credit unions held $1.17 trillion in loans as of July 31, up 6.5% from July 2019 — about the same pace of growth from July 2018 to July 2019.
26% of Americans Have Used Some Type of Payment Deferral Plan
When the pandemic hit in early spring, it seems like everyone was offering some sort of payment deferral program. Financial institutions, student loan companies, credit cards, lenders — even utility providers -- rolled out plans that allowed consumers to temporarily suspend payments.
And for many Americans, it was a lifeline they grasped onto with both hands. About one-in-four Americans say they’ve taken advantage of some sort of payment deferral program because of the Covid-19 pandemic, according to the latest data released from Northwestern Mutual’s 2020 Planning & Progress Study. The online survey included over 2,700 U.S. adults and was fielded between June 26 to July 10, 2020.
Housing and credit card payment deferral programs were among the more common plans consumers opted into, the survey found. And more Americans may be forced out of these plans as the programs expire.
The Federal Reserve Will Stay on Hold Until 2023, According to CNBC Survey
In the first CNBC Fed Survey since the Federal Reserve announced its new, more dovish monetary policy strategy, respondents now forecast no rate hikes from the central bank until 2023.
The results are a potential first sign that the Fed’s new strategy of allowing inflation to run above its 2% target for an unspecified time have had an immediate impact on the rate outlook.
It Hasn’t Been This Hard to Get a Mortgage in Six Years
Mortgage credit in August was the tightest in more than six years as a weak economy prompted lenders to tighten standards, the Mortgage Bankers Association said in a report on Thursday.
The group’s Mortgage Credit Availability Index fell 4.7% to 120.9 last month, the lowest since March 2014, indicating stricter requirements to get loans. The index plunged from record highs seen in late 2019 after the COVID-19 pandemic caused the worst economic contraction since the Great Depression.
The drop in the availability of credit was “driven by a reduction in supply from both conventional and government segments of the market,” said Joel Kan, an MBA associate vice president.
Risk Management
COVID Era Brings ID Theft to One-in-10 Adults: TransUnion
The COVID-19 pandemic has brought heightened concerns of fraud for Americans, and for good reason. Ten percent of U.S. adults have reported being a victim of identity theft since the onset of the pandemic, according to a new survey.
More than eight in 10 adults (83%) said they have been concerned about having their identity stolen, and the level of distress over this crime occurring has increased for nearly one-third of them (32%) in 2020, the survey of 2,108 U.S. adults, conducted by the public sector business of TransUnion on Aug. 11, found.
Younger adults have been targeted by fraudsters the most, according to the survey. Of the Gen Zers (those born in 1995 or after) surveyed, 16% said they were a victim of identity theft; 15% said they had a government account taken over by someone else, compared to 7% for all generations; and 16% reported being a victim of unemployment benefits fraud, followed by millennials (those born from 1980 to 1994) at 8% and all generations at 7%. The vast majority of respondents who have been a victim of unemployment benefits fraud have not resolved the problem, TransUnion noted.
What’s more, 13% of Gen Z respondents said they had their 2019 tax return fraudulently filed, compared to 7% of all respondents; and 12% of Gen Zers had their stimulus check stolen, versus 6% of all respondents.
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