Mountain West News
Federal Reserve Board Debit Interchange Final and Interim Final Rule |

CUNA has posted its Final Rule Analysis on the interchange fee limits for large issuers and the requirements for issuers to participate on two unaffiliated networks by April 1, 2012 as well as a Regulatory Comment Call on the interim final rule on the standards large issuers must meet to receive an additional penny of interchange fee income per transaction. The Final Rule Analysis can be accessed here and the link to the Comment Call is here.  CUNA is expected to provide additional analyses of the rules in the coming days.

Some payment processors and networks have already provided guidance to financial institutions regarding the impact of the Fed's interchange rule.  Credit union debit card issuers that belong to only one network are advised to consider their options, as all issuers must participate in two independent networks under the new rule, effective April 1, 2012. CO-OP Financial Services is advising, “if your credit union is currently VISA-exclusive (VISA for signature and Interlink for PIN) or MasterCard-exclusive (MasterCard for signature and Maestro for PIN), you will need to add an unaffiliated PIN network (such as STAR, Pulse or NYCE)” but would not need to add a second signature network.

Following issuance of the final rule, TCF National Bank dropped the case it had brought against the Fed.

Acknowledging concerns expressed by Senators, credit unions, and community banks, the Fed has agreed to monitor the impact of the final rule on small issuers and has directed staff to come back to the board with two reports, one in six months and the other in 18 months, that will allow the agency to assess how the rule is affecting small issuers, including credit unions.

CUNA has told credit unions that it will be working closely with the Fed on these studies and will be reporting on their efforts along with the Fed’s reports in the coming weeks and months. CUNA said that it will continue working with the networks to urge them to adopt and maintain a two-tiered system that will allow small issuers such as credit unions, to receive as much of their current debit fee interchange income as possible. In addition, CUNA has committed to continuing communications with Senators that have promised to work to ensure the viability of the small issuer exemption and hold them to their word.

ERM and ALLL White Papers Available |

The Colorado Credit Union Working Group - a group of seven credit unions in the state of Colorado - has produced two white papers to assist credit union colleagues in the areas of Enterprise Risk Management (ERM) and Allowance for Loan and Lease Losses (ALLL).

A successful Enterprise Risk Management (ERM) process can help credit unions meet many challenges and uncertainties head-on by providing a framework within which managers can explicitly consider how the organization's risk exposures are changing, determine the amount of risk they are willing to accept, and ensure that they have the appropriate risk controls in place to limit risk to predefined tolerance levels.  The Enterprise Risk Management White Paper was designed to educate and provide guidance to credit unions as they evaluate options and opportunities to develop their own ERM approach and build their own value.

Changing economic conditions require credit unions to understand and utilize all appropriate resources to manage loan portfolios, assist members, and accurately estimate and fund the Allowance for Loan and Lease Losses.  The Allowance for Loan and Lease Losses White Paper focuses on best practices in ALLL funding, in accordance with the NCUA requirements and Generally Accepted Accounting Principles (GAAP).  It examines the key elements of ALLL methodology, as well as important qualitative and environmental factors, internal controls and collection practices.  It is designed to educate and provide guidance to credit unions as they look to adequately measure and account for losses in their loan portfolio — regardless of asset size.

New Compliance Expert |

We are excited to announce the addition of credit union compliance expert, Michael Chevarria to the Compliance Solutions Team.
 
Michael makes a strong addition to our top-notch team of compliance experts that includes Jan Dietzenbach, Julie Kappenman, David Swan, and George Marentis.  Michael’s 31 years of compliance experience includes 21 years as a state examiner and 10 years working directly with credit unions on compliance issues.  During his tenure as an examiner Michael attend classes through the Conference of State Bank Supervisors (CSBS), the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration (NCUA) and the Credit Union National Association (CUNA).  He received the Bank Secrecy Act Compliance Specialist Certification (BSACS) in 2009.  Michael has an impressive background in Regulatory Review, Bank Secrecy Act, Asset-Liabilities Management, and Policy Development.  Most importantly, he believes strongly in the Credit Union Philosophy and supports the ideals of the Credit Union Movement.
 
We are delighted to welcome Michael Chevarria to the Compliance Solutions Team and know that you will directly benefit from his breadth of experience in serving credit unions.
 
If you have any questions regarding Compliance Solutions, please feel free to contact Melia Heimbuck at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or 720.479.3325.  You can also contact Dan Santangelo at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or 720.479.3276.
 
Thank you for your support of Compliance Solutions and we look forward to your continued participation in the years to come. 
 
 

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