Proposed Regulations

The proposed rule would make a number of changes to various parts of NACHA's rules that address risk management.

The Treasury, Railroad Retirement Board, Social Security Administration and Department of Veterans Affairs (VA) issued an interim final rule to provide guidance to financial institutions that receive a garnishment order for an account which holds exempt federal benefit payments.

The proposed rule revises the definition of “net worth” so that NCUA-contributed capital can be included in the calculation of regulatory capital under some circumstances. NCUA would permit a credit union to include § 208 assistance as regulatory capital where the assistance consists of capital accounts that: have a remaining maturity of five years or more; are not insured by the NCUSIF; may not be pledged as security on a loan to, or other obligation of, any party; have non-cumulative dividends; and are subordinate to the NCUSIF, shareholders, and creditors.

The Treasury Department is seeking comment on the type of information the Consumer Financial Protection Bureau (CFPB) should request from consumers filing complaints.

The proposed rule would require federally-insured credit unions (FICUs) to adopt and implement an interest rate risk (IRR) policy and management program. The requirements would apply to all FICUs with assets over $50 million and FICUs with assets between $10 and $50 million if the total of first mortgage loans held plus total investments with greater than 5 years maturities is equal to or greater than 100% of net worth.

The proposal would condition a depositary credit union's right of expeditious return on the depository credit union agreeing to accept returned checks electronically either directly or indirectly from the paying credit union.

The proposed rule would require financial institutions to disclose the structure of all incentive-based compensation arrangements.

In January of 2010, the Federal Reserve Board (the Board) and the Federal Trade Commission (the FTC) (collectively the Agencies) issued a rule (the January 2010 Rule) to implement the risk-based pricing provisions of the Fair Credit Reporting Act (the FCRA). That rule went into effect on January 1, 2011. The January 2010 Rule requires creditors that extend credit, based on the individual's credit report, at material terms that are less favorable than the terms available to most customers to provide a risk-based pricing notice. The notice must include several specific disclosures; however, it is generally intended to inform consumers that the creditor used a credit report in making its decision and that information in the credit report impacts the terms available to the consumer.

The proposed rule implements relevant provisions of the Dodd-Frank Act in three ways.

The proposal would require certain disclosures for any mortgage for which an escrow account is established. Previously, such disclosures were only required for “high-priced” mortgages for which escrow accounts were required by Regulation Z.

NACHA is considering proposing rules concerning ACH security, and has issued a framework for issuing the proposal.

FinCEN issued this Advance Notice of Proposed Rulemaking (ANPR) in order to gauge the potential financial crime and money laundering risks that may be posed by non-bank residential mortgage lenders and originators. Assuming that such institutions may pose such a risk, FinCEN is seeking comment on the extent of the risk and the scope of AML regulations which would be appropriate to monitor and safeguard that risk.

In the ANPR, FHFA requests comments on various changes it is considering with respect to its regulations on membership eligibility requirements.

The proposed rule would eliminate three exemptions from the requirement that federally insured credit unions use NCUA's official advertising statement or a specifically-permitted alternative.

The proposed rule provides that the NCUA will fully insure the net amount that any member maintains in a noninterest-bearing transaction account at an insured credit union.

Following on the heels of a proposed privacy regulation set forth by the Office of the Comptroller of the Currency, Office of Thrift Supervision, Federal Reserve Board, and the Federal Deposit Insurance Corporation, the National Credit Union Administration has issued a proposed privacy regulation for credit unions.

The proposal seeks comment on two different alternatives for setting debit interchange fees. The proposal similarly offers two alternatives for how the fraud adjustment might be calculated. The proposal also details two potential methods for how the Board should execute the network exclusivity and routing provisions.

The interim final rule makes three technical corrections to the September 2010 Final Rule. The corrections concern: the definition of “collateral debt obligation”; exemptions to the limitations on corporate investment authority; and a model form on perpetual contributed capital.

The proposal would apply fair value measurement (i.e., exit price) for loans that are held-tomaturity.

The proposed rule would make a number of important changes to NCUA's regulations governing corporates, but also those regulations governing natural person credit union (NPCU) membership in corporates.

Recently, the Board of Governors of the Federal Reserve System (the Board) issued an interim final rule (interim rule, or rule) regarding appraisal independence. The intent of the new rule is to protect against conflicts of interest that might lead an appraiser to overestimate the value of a home in order to justify the loan price. This is the third in a recent line of attempts aimed at appraiser independence.