Important News
President Obama signs Corporate Stabilization Bill
Credit card bill signed into law;
ICUL defeats adverse amendment on interchange fees; gift card language modified
Action required: ICUL Data Collection Update
Illinois CUs once again support funding of college student loans
ICU Foundation provides first round of grants for 2009
June REAL Solutions Partners webinar, meeting part of 2009 Expansion
Matz being considered as NCUA Chair
President Obama signs Corporate Stabilization Bill
Wednesday afternoon (May 20, 2009), President Obama signed into law S. 896 (the Helping Families Save Their Homes Act), the housing bill that contains the provisions we have supported and worked for to mitigate the cost of NCUA’s corporate stabilization actions. As a result of this legislation, what would have been a 99 basis-point-of-insured-shares cost to credit unions this year will likely be reduced to something in the range of 10 to 15 basis points (CUNA will be pursuing proper implementation of the legislation with NCUA and we expect guidance in the near future from the agency on this).
The legislation moved with unusual speed. The President signed the bill just one day after it passed both the House and Senate. Joining him at the White House ceremony was Tony Emerson, president of the Credit Union League of Connecticut, who was personally invited by Senate Banking Committee Chairman Christopher Dodd (D-CT).
Your grassroots efforts on behalf of the corporate provisions were also exceedingly important in this process. By CUNA's estimates, Congress received more than 30,000 contacts from credit unions prior to passing the legislation. The grassroots effort complemented a sustained effort over the last several months on CUNA’s part in Washington to advance this legislation.
Please click here to read more, including the provisions that were included as part of the bill. Please also note that NCUA is planning a webinar on the new bill for June 24. We will provide more details on this webinar as they become available.
Also visit ICUL's online Corporate Rescue Plan Resources section, including a Q & A about common questions, and to stay up to date on this issue.
Credit card bill signed into law;
ICUL defeats adverse amendment on interchange fees; gift card language modified
On May 19th, 2009 the full Senate approved its version of HR 627, the Credit Cardholders’ Bill of Rights legislation by a vote of 90-5.
The House also approved the bill by a vote of 361-64 the following day. President Obama, who pushed for the bill's passage by Memorial Day, signed it on May 22, 2009. The credit card provisions of the bill are effective nine months from enactment. ICUL is currently analyzing the bill and will provide compliance information in the near future.
The legislation builds on very similar final rules promulgated by the NCUA, Federal Reserve Board (FRB) and Office of Thrift Supervision addressing unfair and deceptive practices on credit cards effective next summer. More specifically, however, the legislation addresses interest rate increases on outstanding balances, methods for computing balances and prohibits lenders from raising rates when a cardholder is late on a separate debt, a practice known as “universal default”. Generally credit unions do not engage such practices and CUNA expresses support for the bill’s efforts to eliminate unfair and deceptive practice in testimonial before the House and Senate Banking committees.
Adverse amendments and language addressing credit card interchange fee restrictions and prepaid gift cards were discovered. ICUL acted to vigorously oppose these amendments. In the final analysis, these proposals were either withdrawn or modified as a result of grassroots efforts with Senators Dick Durbin (D-IL) and Chuck Schumer (D-NY).
More specifically, the Interchange Fee amendment was withdrawn in favor of a Government Accounting Office (GAO) study on credit card interchange fees and the restrictive gift card language was modified by Senator Schumer to require the FRB to adopt regulations on all gift card program service fees and conditions, including the general-use branded Visa prepaid cards offered by the LSC. ICUL will closely follow and make appropriate comments on both the Interchange Fee GAO Study and FRB rulemaking on gift cards.
Action required: ICUL Data Collection Update
On May 22, all affiliated credit unions were mailed several forms as well as information about opportunities available to members of the Illinois Credit Union League. Your assistance is needed to review the materials, as some of them require your response. The information sent included:
- Field of Membership Survey – Response Requested by July 31
- Online Credit Union Directory Update – Response Requested by July 31
- Email Newsletter and ListServ Subscriptions Update – Response Requested by July 31
- Find A Credit Union Program
- Job Classifieds
Please refer to the forms and information mailed to your credit union. You may also read more details by clicking here. If you have any questions, please contact Vicki Ponzo, Senior Vice President of Member Services, at 800-942-7124.
Illinois CUs once again support funding of college student loans
Illinois-based credit unions will invest nearly $100 million in securities issued by the Illinois Student Assistance Commission (ISAC) to finance low-interest, federally secured loans through the Federal Family Education Loan Program (FFELP) to Illinois students and their families, making college affordable for thousands of Illinois students for the second straight year.
The commitment level by 12 credit unions thus far is approximately the same as the $100 million secured in September, 2008. This figure could grow as new participants join in and commitment levels increase in the next six months. The announcement of these funds is taking place during press conferences being held throughout the state at participating credit unions.
The Illinois Credit Union League (ICUL) played a critical role in securing credit union support. The credit unions involved in the partnership include Alliant Credit Union (Chicago), Baxter Credit Union (Vernon Hills), Citizens Equity First Credit Union (Peoria), CommonWealth Credit Union (Kankakee), Corporate America Family Credit Union (Elgin), Credit Union 1 (the State employees’ credit union based in Rantoul), I.H. Mississippi Valley Credit Union (Moline), ISU Credit Union (Normal), Motorola Employees Credit Union (Schaumburg), Scott Credit Union (Collinsville), SIU Credit Union (Carbondale), and University of Illinois Employees Credit Union (Champaign).
"We are pleased to once again team up with ISAC and continue backing their efforts to help students get a quality education,” said Dan Plauda, ICUL president/chief executive officer.
The Illinois Student Assistance Commission provides students of all ages and backgrounds with the resources and support to obtain financial aid for higher education. Students and families have free access to a wealth of financial aid and college planning information at ISAC’s family of websites available at www.knowhow2GOIllinois.org.
ICU Foundation provides first round of grants for 2009
The Illinois Credit Union Foundation’s grants committee recently awarded $75,675 in Small Credit Union Development (SCUD), community service, marketing and business development, and Financial Independence & Revitalization Effort (FIRE) grants, as well as numerous scholarships.
SCUD grants totaled $26,775 and were awarded to 11 credit unions. Purposes for the SCUD grants included computer equipment and software, Internet banking, computer upgrades, specialized software, Web site set-up, strategic planning sessions, office equipment for new facility, and new computers.
The Foundation also awarded $800 in Community Service Grants. This program is designed to encourage and reward chapter or credit union participation in local community projects. Credit unions and chapters can qualify for grants by hosting an established event, creating an event, or volunteering at an established event. One chapter and one credit union received a community service grant.
In addition, four credit unions received marketing and business development grants that totaled $14,000. These grants were established in 2006 to help credit unions with assets of up to $30 million to start or expand outreach efforts. The maximum grant award is $5,000 per credit union per year.
Rounding out this round of grants was one credit union that received a FIRE grant for $5,000. The purpose of the FIRE Program is to provide assistance to credit unions to expand their ability to build and maintain viable communities by providing credit and financial services to residents and businesses in low-income and underserved areas of Illinois. The goal of the FIRE Program is to enhance membership services for credit unions located in economically disadvantaged areas.
Lastly, $29,100 was awarded in scholarships. Individuals and groups (as a chapter or group of credit unions) are welcome to apply. Scholarships may be used toward ICUL’s many educational opportunities, as well as CUNA Schools.
There are two more grant request deadlines during 2009 on July 31 and October 31. In addition, scholarships are reviewed on an ongoing basis while funds last. Online and downloadable ICU Foundation grant request forms are available via the League's Web site. Eligibility is limited to Illinois credit unions and chapters.
June REAL Solutions Partners webinar, meeting part of 2009 Expansion
REAL Solutions, a signature program of the National Credit Union Foundation, has been expanding in Illinois during 2009.
This expansion has included a series of webinars and in-person meetings for program "Partners" (participating credit unions). What’s new in 2009?
- Webinars - informational sessions on REAL Solutions programs, products and services, that are recorded and available for viewing 24/7 following the “live” session, to enable credit unions to participate at their convenience. The webinars are stand-alone sessions, so credit unions can pick and choose which one(s) to attend.
- Roundtables - following the webinars, credit unions that are ready to take the next step as well as credit unions who already offer each REAL Solutions program, product or service, can attend in-person roundtable meetings. Participants network with one another, share successes and challenges, and learn about new developments in the specific area. Work groups to explore ideas, leverage resources, and develop partnerships can be formed.
On June 2 and June 25 respectively, a webinar and in-person meeting will be held to discuss the Volunteer Income Tax Assistance program (VITA). The U.S. Government has billions of dollars to return to working people that don't earn high wages, but thousands of Illinois families don't receive it. Even more people are eligible for free tax-preparation services, but instead pay to have their returns completed and pay hefty fees for Refund Anticipation Loans (RAL). Credit unions can help by learning about the Earned Income Tax Credit (EITC) and VITA. Whether hanging a poster, becoming a VITA volunteer or running a full-fledged campaign, credit union efforts to educate working families about these powerful tax benefits will put money back into their pockets, back into the community, and give credit unions an opportunity to do what they do best--help people.
Foreclosure assistance will also be a primary topic. The problem: An estimated one out of every 200 homes will be foreclosed upon in the coming months, and everyone will be affected - not only those in the foreclosure process. Credit unions can play an important role in helping members avoid or survive foreclosure and steer clear of scams, as well as help by becoming a trusted resource for their members, helping connect them with state and federal government-sponsored programs, as well as local social service agencies.
The Illinois Credit Union League and the Illinois Credit Union Foundation have teamed up with the National Credit Union Foundation to bring you a program called, “REAL Solutions for Low Wealth Households.” REAL stands for Relevant, Effective, Asset building, Loyalty-producing Solutions. Credit unions that want to learn more about becoming a REAL Solutions Partner are invited to join the program. Click here for more information about the program.
Matz being considered as NCUA Chair
President Obama recently stated he intends on nominating Deborah Matz as chair of the National Credit Union Administration (NCUA).
Matz was the Executive Vice President and Chief Operating Officer of the $800 million Andrews Federal Credit Union located in Suitland, Maryland until June 2008. Prior to that, she served on the NCUA board, confirmed by the U.S. Senate on March 22, 2002.
Michael Fryzel, current NCUA Chair, may continue to serve on the board. His term is effective until 2013. In a press release dated May 22, 2009 Fryzel stated, “When confirmed, she (Matz) will assume the Chairmanship of the NCUA at a historic time marked by significant challenges. The stresses, difficulties and ultimately the successes of these days will not be easily forgotten. As we move into the next chapter of the story, I am hopeful that every facet of the credit union system be united by a common purpose to constantly improve and better not only the credit unions themselves, but most importantly the members upon whom they depend."
If confirmed, Matz will chair the board until April 10, 2015.