Credit Union Newsletter - #35
Anurag Mukherjee
Credit Union & Community Bank C-Suite Advisor | P&L and GTM | Data Scientist | Fintech Advisor & Podcaster
The NCUA Board received good news about the Share Insurance Fund's first-quarter performance during its fourth open meeting of 2024 on Wednesday.
In a briefing, the NCUA Board learned the Share Insurance Fund's net income totaled $68.1 million and its net position totaled $21.6 billion for the first quarter of 2024. What's more, the fund's total assets increased to $21.6 billion at the end of the quarter from $21.0 billion at the end of the fourth quarter of 2023. And, no credit union failures took place during the first quarter.
The report presented to the Board also stated that NCUA staff projects the equity ratio for the Share Insurance Fund to be 1.24% on June 30, 2024
The Mortgage Bankers Association lowered its originations forecast again this month, but not as severely as it did in April.
Meanwhile, a report released Monday by FreddieMac economists said it expects "modest growth" in mortgage originations for purchases this year, largely driven by rising prices. "We expect refinance origination volumes to decline as homeowners have already secured low rates, posing potential challenge in the refinance market."
The MBA's May 16 forecast limited changes to its forecasts for first-mortgages for purchases, lowering them 3% in this year's second quarter, and 3% for 2025 and 2026. The MBA said it now expects lenders will close on $336 billion in purchase mortgages in the three months ending June 30, down 9.4% from a year earlier.
For the year, the MBA said it expects $1.38 trillion in purchase originations, up 4.4% from 2023, while forecasting refinances will grow 34% to $422 billion.
The Financial Crimes Enforcement Network (FinCEN) posted a request for information in March asking for feedback related to changes in the Customer Identification Program (CIP) Rule, which could expand access to consumers' full Social Security number (SSN) by third-party organizations – a change America's Credit Unions opposes.
According to America's Credit Unions, "The existing rule requires financial institutions to implement a written CIP that includes identity verification procedures, and financial institutions must currently collect a full SSN from a customer to fulfill the Taxpayer Identification Number (TIN) requirement."
The $5.5 billion Gesa Credit Union in Richland, Wash., said Thursday it plans to acquire the $598 million Security State Bank in Centralia, Wash.
Financial terms of the definitive agreement were not disclosed.
If approved by regulators and shareholders, the deal is expected to close in 2025.
Founded in 1903, Security State Bank's 100 employees manage $499 million in deposits and $233 million in loans, and run 12 branches that serve more than 13,000 customers.
Chartered in 1953, Gesa's 815 employees manage $561 million in deposits and $4.2 billion in loans, and run 32 locations that serve more than 289,000 members.
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Florida's largest credit union said Wednesday it launched treasury management services for business members.
The $18.1 billion Suncoast Credit Union in Tampa said its treasury management services will offer a suite of commercial products and services including automated clearing house, remote deposit capture and fraud prevention tools.
"Our suite of commercial treasury management products provides the insight, technology and flexibility commercial businesses need to maximize their resources and optimize operations," Suncoast Vice President of Commercial Services Dominic DiMaio said in a prepared statement. "These sophisticated products help businesses achieve their goals with the support of experienced teams that are dedicated to helping navigate the business landscape – all at a lower cost structure than banks."?
?Harborstone Credit Union in Lakewood, Wash., said Tuesday it completed the purchase of First Sound Bank in Seattle.
The combination of the financial institutions means Harborstone is currently managing approximately $2.1 billion in assets, $1.5 billion in loans, and $1.8 billion in shares and deposits, and its 295 employees operate 16 branches throughout King, Pierce and Thurston counties.
"This acquisition further expands our footprint in King County, and it will result in expanded product, service and technology offerings for First Sound Bank's customers as well," Harborstone President/CEO Geoff Bullock said in a prepared statement.?
CFPB headquarters in Washington, D.C. Credit/CFPB headquarters in Washington, D.C.
The CFPB announced Wednesday that it is taking action with a new interpretive rule that states Buy Now, Pay Later (BNPL) lenders are credit card providers – a move that, according to CFPB officials, will require lenders give consumers key legal protections and rights that apply to conventional credit cards.
This announcement from CFPB Director Rohit Chopra came just days after a ruling by the U.S. Supreme Court confirmed the Bureau's constitutional standing.
According to details of the interpretive ruling, consumers will have the "right to dispute charges and demand a refund from the lender after returning a product purchased with a Buy Now, Pay Later loan."
Officials with the Tucson, Ariz.-based Pima Federal Credit Union and RBAZ Bancorp, Inc. in Phoenix announced the two organizations had entered into a definitive agreement for Pima to acquire "substantially all of the assets" and liabilities of the Republic Bank of Arizona in an all-cash transaction.
Details of the announcement, which came late Thursday, stated the $1.2 billion Pima would take over all customers and accounts of the Republic Bank of Arizona. Once the transaction is complete, bank officials said they intend to wind down and dissolve the bank and its holding company RBAZ Bankcorp, Inc. Shareholders are expected to receive "approximately $22.00 per fully diluted share upon final liquidation" pending various adjustments.