The Pulse (02-17-12)
February 17, 2012 ● Volume 01, Issue 07
View 02-17-12 Issue of The Pulse
Credit Union News
Registration now open for the MnCUN Annual Meeting & Convention
Registration is now open for the Minnesota Credit Union Network Annual Meeting & Convention on April 13-14. To be held at the DoubleTree by Hilton Hotel in Bloomington (formerly the Sheraton Hotel), this conference offers a weekend of education, networking and entertainment.
MnCUN is excited to welcome CUNA President/CEO Bill Cheney as a featured speaker at the Business Meeting and Friday and Saturday luncheons. Cheney will discuss national credit union initiatives, provide an update on credit unions' political priorities, and highlight the movement's successes. Attendees will also have the opportunity to hear from former Minnesota Gov. Tim Pawlenty, who will speak at the Saturday luncheon and provide an insider's look at the presidential election process.
This year's Annual Meeting will also feature a number of other prominent speakers, including renowned credit union experts Jim Aho, Rex Johnson and Mark Arnold. These credit union leaders will provide professionals and volunteers insight into the main issues facing today's credit union movement. In addition, MnCUN and the Filene Research Institute will unveil the results of a research initiative on attracting Gen Y members. This general session will summarize the results of this customized, Minnesota-specific research and present recommendations on how credit unions can appeal and market to young adults.
Be sure to register today for this premier credit union event. New this year, all attendees will be automatically registered for the conference's luncheons, which are now included in the registration fee. In addition, MnCUN will host a Crew event geared toward young credit union professionals (age 35 or younger) at Annual Meeting. For complete information and to register, visit the Annual Meeting section of the Network website. Be sure to register by Thursday, March 15, to take advantage of the early bird pricing.
MnCUN urges NCUA to withdraw loan participations proposal
On Feb. 15, the Minnesota Credit Union Network responded to NCUA's request for comments on a proposed rule regarding loan participations. Among other things, the proposed rule would make loan participations more complicated and could actually hurt credit union loan growth.
MnCUN is very concerned with this proposal due to the effect it would have on credit unions' ability to diversify their loan portfolios, mitigate risk and improve earnings. Therefore, the comment letter urged the agency to withdraw the proposed rule.
Within the letter, the Network highlighted its concerns regarding the rule's single originator limit. Specifically, credit unions' ability to purchase loan participations from one originator would be limited to 25 percent of the purchasing credit union's net worth. For small credit unions, this would mean that they would be required to use multiple originators to build their loan portfolios. For large credit unions, the proposed rule would needlessly complicate the process for identifying eligible participants.
MnCUN's letter stated that "there is no justification provided for the rule as proposed. The single originator limit of 25 percent is not justified by any concrete support or data.” MnCUN is also concerned about the impact this proposed rule would have on the dual chartering system. The proposed rule undermines state regulators' authority to address safety and soundness concerns and eliminates each state's flexibility regarding loan participations.
Due to the potential impact of this issue, it is very important that credit unions submit their own comment letters. Credit unions are encouraged to use MnCUN's comment letter as a guide when writing their letters. Letters must be submitted by Tuesday, Feb. 21, and should be emailed to email@example.com or mailed to:
Ms. Mary Rupp
Secretary of the Board
National Credit Union Administration
1775 Duke Street
Alexandria, VA 22314
Thank you in advance for submitting comment letters on this issue. If you have any questions, contact MnCUN General Counsel John Wendland.
MnCUN CEO touts CUs ability to lend in Finance & Commerce
In his latest column in Finance & Commerce newspaper, MnCUN President & CEO Mark D. Cummins proclaimed that Minnesota credit unions stand ready to help small businesses obtain funds. A frequent columnist for the publication, his article entitled "Credit unions prepared to boost lending in 2012,” was published on Feb. 9.
Countering bankers' claim that the demand for loans has decreased over the past quarter, Cummins stated that credit unions have increased their business lending activity by nearly 3 percent over the past quarter and 8 percent over the past year. The column highlighted that 60 percent of small business owners nationwide have had difficulty obtaining credit over the past year.
"Credit unions are eager to increase their efforts to help Minnesota's small businesses obtain funds…but [they] are prevented from doing so by a cap that limits member business lending activities to 12.25 percent of assets,” Cummins wrote.
Referencing member business lending legislation in the U.S. House and Senate, Cummins stated that the passage of these bills could inject $181 million into Minnesota's economy and help create nearly 2,000 jobs. He highlighted the fact that these new jobs and new loans would be created at no cost to the public.
"Nationwide, credit unions are sitting on millions of dollars they could lend to job creators if Congress would repeal the regulations that stop them from doing it,” Cummins concluded. "Today, small businesses need more options, and credit unions are in a position to help.”
More information about MnCUN's efforts to advocate for member business lending legislation can be found in the Minnesota CU reps Hike the Hill to support member business lending article in this issue of The Pulse.
NCUA to host free small credit union workshop
To help small credit unions work through current challenges and opportunities, the NCUA will host a free workshop on May 11 at the Marriott Hotel in Bloomington. This event will provide tools and information to help credit unions tackle current issues facing the movement.
Geared toward professionals and volunteers of small credit unions, this workshop will discuss examination issues, fraud detection, ALM and director duties. Attendees will also examine how to run a profitable credit union, the initiatives of the Office of Small Credit Unions, and new rules and regulations. Upon completion of the workshop, participants will receive a certificate of attendance.
NCUA is offering travel reimbursements for eligible credit unions attending the workshop. To qualify, credit unions must be under $10 million in assets, have been chartered for less than 10 years, or have a low-income designation. Credit unions may apply for the travel reimbursement when registering for the workshop.
For more information and to register, visit the Event Calendar section of the Network website. Space is limited and registration is available on a first-come basis.