From all of us at the Association, we wish you and your family a wonderful, safe holiday season.
A personal message from Rick Myxter, Director, Small Credit Union Development:
After 20 years of service in the credit union movement, Rick is moving onto the next phase in his life, retiring from the Association as of December 21, 2012. His devotion to the success of small credit unions will surely be missed! Join us in wishing him well.
Twenty officials from seven of Philadelphia’s small credit unions gathered at The Triumph Baptist Church Thursday evening, November 29th, for Director Financial Literacy Training.
A potluck dinner provided by Mid-Atlantic Corporate FCU and the credit unions preceded the event. Special thanks to Mid-Atlantic’s Corporate Account Manager Deb Cohn, The Triumph Baptist FCU’s CEO Sharon Saulters, Service Center for Credit Unions President Joni Brown and NCUA Economic Development Specialist, Dominic Carullo, for coordinating the successful evening of camaraderie and learning.
CU PolicyPro: A second look at Troubled Debt Restructure
NCUA has amended its regulations to require federally-insured credit unions (FICUs) to maintain written policies that address the management of loan workout arrangements and nonaccrual policies for loans, consistent with industry practice or Federal Financial Institutions Examination Council (FFIEC) requirements. The final rule includes guidelines, set forth as an interpretive ruling and policy statement (IRPS) and incorporated as an appendix to the rule, that will assist FICUs in complying with the rule, including the regulatory reporting of troubled debt restructured loans (TDR loans or TDRs) in FICU Call Reports.
The effective date for this rule is July 2, 2012. The compliance date was extended to October 1,2012, for the rule’s requirements to adopt written policies addressing loan workouts and nonaccrual practices and to December 31, 2012, to collect nonaccrual status data.
The updated policy will clarify a section of the Troubled Debt Restructuring policy Regulatory Reporting of Workout Loans Including TDR Past Due Status.
The final IRPS mandates that the past due status of all loans should be calculated consistent with loan contract terms, including amendments made to loan terms through a formal restructure. The IRPS eliminates the current, dual, and often manual delinquency tracking burden on FICUs managing and reporting TDR loans, while instituting a nonaccrual policy on TDR loans apart from past due status. The Call Report instructions will be modified accordingly. With regard to bankruptcies, the new rule does change TDR delinquency reporting. Chapter 13 bankruptcies would not be reported as delinquent based on the original terms, but rather on the restructured terms. The exception would be member business loans (MBLs).
Therefore, in the next CU PolicyPro update (January 2013), Policy 3170 will be revised. In the meantime, the updated information can be found in the Library section of CU PolicyPro under Ops Notes, September 2012
Q: One of our tellers has filed bankruptcy and caused the credit union a loss; can we terminate her employment?
A: No. A credit union may not terminate an employee if the decision to terminate is based solely upon the fact the employee has filed bankruptcy, even if the employee causes the credit union a loss.
Q: How can we stay on top of the many laws and regulations affecting credit unions. Do you have any tips for us?
A: Every credit union should appoint an employee, board member or committee member to oversee its compliance program. Utilize the recourses you have available.
FREE compliance resources from your Association:
CUNA & Federation Sponsor FREE Webinar
All low-income designated credit unions should plan to attend a free webinar co-sponsored by CUNA and the National Federation of Community Development Credit Unions.
Entitled Fuel for Growth: Understanding and Planning for Supplemental Capital, you'll learn how secondary capital can propel your credit union's growth. Each dollar of secondary capital can leverage up to $14 dollars of new deposits.
Participants will also learn about sources of secondary capital. Click here for details and to register.
Judge/Bradley Scholarship Applications DUE 12-31-2012
The Association, Pacul Services, Inc., and CUNA Mutual Group are proud to support the Judge/Bradley Leadership School, a time-tested, credit union-focused leadership training program, by offering several scholarships to attend the 2013 class.
Whether you’re looking to develop the future leaders of your credit union, or enhance your own leadership skills, the Judge/Bradley Leadership School offers a positive and stimulating learning environment to develop into tomorrow’s credit union leader.
For more information, visit the Judge/Bradlely Leadership page at www.pcua.org.
Preparing for Unforeseen Events
Business interruptions and disasters have the potential for causing a widespread impact on credit unions of any size due to an immediate loss of physical assets and technological infrastructure.
Only one thing is certain: disasters, large and small, will happen. An unfortunate fact is most smaller credit unions are among the least prepared, and the most likely to fail following an interruption. How can management take the necessary steps to protect their members’ assets and their credit union’s operations, while still making proper use of the credit union’s limited funds?
Pennsylvania Credit Union Association