JULY 11, 2014
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Go vote Get Out the Vote for July 22nd:
CUs Can Be the Difference (Issue 1 of 6)

Turnout has been low in early voting for the July 22 runoff, creating the opportunity for credit union supporters to make a big difference in several important races by voting and encouraging others to vote.

  NCUA Questioned by Chair on RBC (Issue 2 of 6)
The chair of a U.S. House Financial Services panel asked NCUA Chair Debbie Matz to provide, by July 18, additional information on NCUA's proposal for risk-based capital.

  Credit Union Supporter Woodall Moves Up (Issue 3 of 6)
Georgia U.S. Rep. Rob Woodall won unanimous election as chairman of the Republican Study Committee, which includes most House Republicans and is designed to direct the GOP leadership team to the right on policy issues.

  Don't Miss the Idea Train! (Issue 4 of 6)
There is still time to sign up for Idea Institute 9, scheduled for Aug. 18-20 at the Ritz-Carlton in Amelia Island, FL. The event promises to produce lively discussion and debate on a range of topics important to credit unions.

  Small-Business Counselor: Enter Credit Unions (Issue 5 of 6)
In a Wall Street Journal article about small-business lending, Maria Contreras-Sweet, the new head of the U.S. Small Business Administration, emphasized the importance of counseling before lending.

  SunTrust's $300M Price Tag on HAMP Claims (Issue 6 of 6)
The Atlanta Business Chronicle reported that SunTrust Mortgage Inc. will pay up to $300 million to settle claims over its administration of the federal Home Affordable Modification Program (HAMP).

Get out the voteGet Out the Vote for July 22nd:
CUs Can Be the Difference (Issue 1 of 6)

Early voting for the July 22nd primary runoff has been low; the July 2nd Augusta Chronicle highlighted how few people had voted by that point. It also highlighted an early voter, a credit union board member: Jeff Padgett of Richmond Community FCU. One can only imagine if all the staff and volunteers from credit unions vote in these elections (much less the 1.9 million credit union members in the state!). With few votes anticipated, credit unions can be the difference in the elections. But it takes your credit union’s involvement to encourage staff, volunteers, and even members to vote in these. And this involvement matters, as there are six supported candidates for office in the runoff:

  1. Mike Collins (R) 10th Congressional District: Mr. Collins has been a board member of Associated Credit Union for several years, and is in a runoff against Jody Hice for the seat vacated by Rep. Paul Broun. As a credit union board member, Mr. Collins would be an asset in Congress as he is familiar and supportive of credit union issues.
  2. Buddy Carter (R) 1st Congressional District: Prior to entering this race for the seat vacated by Rep Jack Kingston, Mr. Carter served a state senator. Mr. Carter is well know by several credit union officials in his district, and has been very accessible to credit union lobbying efforts at the state house during his tenure. He faces Dr. Bob Johnson in this runoff.
  3. Bob Barr (R) 11th Congressional District: As a U.S. Representative in the late 1990s, Mr. Barr came out early in support of H.R. 1151 to back credit unions. At Georgia’s request, he introduced legislation to expand the number of NCUA Board members from three to five, and has supported credit unions in a variety of ways throughout his career. He faces former State Sen. Barry Loudermilk in the runoff.
  4. Jack Kingston (R) U.S. Senate: Congressman Kingston supported H.R. 1151 in 1998 to support credit unions, recently co-sponsored H.R. 1553 on Exam Fairness, and has been accessible to Georgia credit unions in D.C. He recently signed onto the letter to NCUA asking the agency to carefully consider changes to the Risk-Based Capital proposal and its impact on consumers.
  5. P.K. Martin (R-Lawrenceville) 9th State Senate District: State Sen. Don Balfour was the incumbent candidate in this race, and was the highest ranking state lawmaker to lose in the May primary. Mr. Martin has strong ties with Peach State FCU, and understands firsthand the value of credit unions in the district. He faces Mike Beaudreau in the runoff.
  6. Jack Murphy (R-Cumming) 27th State Senate District: Sen. Murphy is the incumbent in this district and, although he participated in a very crowded primary, advanced to the runoff with Michael Williams. Mr. Murphy has been supportive of credit union initiatives in the state legislature, speaking out for issues that are positive for the industry and speaking against those that would negatively impact the manner in which credit unions serve their members. His continued accessibility and support of our issues is important in our efforts at the Capitol.
In some of these races there is no general election competition (meaning who wins in July, wins the seat). Credit unions have an opportunity to provide meaningful campaign support in critical races, and your credit union can make a difference by sharing this information with your staff and/or membership. Some credit unions around the state have encouraged their staff to vote, their members to vote, participated in partisan communications, and/or run articles in newsletters educating on the credit union systems support of these candidates. But regardless, be sure to vote! To gain access to tools to engage your staff, volunteers and/or members go to ElectionWatch and click on Credit Union Resources.
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U.S. CapitolNCUA Questioned by Chair on RBC (Issue 2 of 6)

Rep. Patrick McHenry (R-NC), chair of the House Financial Services subcommittee on oversight and investigations, has asked NCUA Chair Debbie Matz to respond to several clarifications to the agency's risk-based capital (RBC) proposal by July 18th. NCUA's proposal would require credit unions to hold capital at 8% of risk-based assets to be considered adequately capitalized and 10.5% to be considered well-capitalized. This is in addition to the 6% and 7% leverage ratio requirements to be adequately and well-capitalized. NCUA would also reserve the right to require credit unions on a case-by-case basis to hold additional capital. 

McHenry requested that the NCUA provide the subcommittee with the following information:

  • Any cost-benefit analyses performed by the NCUA or that otherwise form part of the administrative record in this matter;
  • The metrics used to determine what asset classifications required revisions;
  • A justification for the revised weighing associated with each individual asset class; and
  • An explanation of the extent to which NCUA examiners would be empowered to assess and make capital recommendations to credit unions that might deviate from the new RBC standards.
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U.S. Rep. Rob Woodall of Georgia speaks at the 2012 CUNA Governmental Affairs Conference Woodall  
Credit Union Supporter Woodall Moves Up
(Issue 3 of 6)

Republican House members continue to make leadership changes since the stunning loss of Rep. Eric Cantor (R-VA). On July 9th, Georgia Rep. Rob Woodall (R-7) was unanimously elected as the next chairman of the Republican Study Committee, effective July 16th. The chairmanship opened after Rep. Steve Scalis (R-LA) was elected as the next Majority Whip last month. Woodall, who is in his second term in Congress, is the chairman for the RSC’s Budget and Spending Task Force and will serve in the role until the current congressional term ends in January. The Republican Study Committee is designed to direct the GOP leadership team to the right on policy issues and counts the vast majority of House Republicans as members.

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TrainDon't Miss the Idea Train! (Issue 4 of 6)

Idea Institute 9 is right around the corner: August 18- 20 at the Ritz-Carlton on Amelia Island, FL. The Idea Institute provides a great combination of credit union practitioners, leaders and issues that set the conditions for lively discussion and debate. Topics for 2014 include the impact of the consumer and spread compression, building an innovation culture in a highly regulated institution, loan portfolio strategies and much more. Discussion topics are strategy-oriented and targeted to the leadership perspectives of the CEO and board chair. However, it is not uncommon for other senior decision makers at the management level or other opinion leaders from the Board to attend.

These are challenging times, but also times that are loaded with opportunity. Learning how others are approaching these opportunities is one of the best ways to provoke your own creativity. Register today at http://www.cuideainstitute.com/.

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Doctor is inSmall-Business Counselor: Enter Credit Unions
(Issue 5 of 6)

The Wall Street Journal reported on the role of lending to small businesses, or rather, the role of counseling to small businesses in lieu of (or prior to) lending. The new head of the U.S. Small Business Administration, Maria Contreras-Sweet, made a statement in an interview regarding the state of small-business lending and the SBA's role in aiding small businesses that "the counseling is almost more important than the lending."

The WSJ article continues from the viewpoint of a firm that offers these services; counseling first and lending afterwards, but is a good reminder as to why small businesses need credit unions. And while the banks work against credit unions in the realm of small-business lending, the competition is out there in all forms.
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ForeclosureSunTrust's $300M Price Tag on HAMP Claims
(Issue 6 of 6)

On July 3rd the Atlanta Business Chronicle reported that SunTrust Mortgage Inc. will pay up to $300 million to settle claims related to its administration of the federal Home Affordable Modification Program (HAMP), including complaints it misled homeowners. According to a filing with the Securities and Exchange Commission, the settlement includes up to $274 million in consumer remediation, $20 million to fund housing counseling for homeowners, $10 million paid toward restitution to Fannie Mae and Freddie Mac, and a cash payment of $16 million to the U.S. Treasury. The complaints alleged SunTrust made misrepresentations and omissions regarding how long it would take to make a decision on whether borrowers qualified for HAMP, the duration of the HAMP “trial period” and how borrowers would be treated while on a trial period.

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