Friday, October 31, 2014

Happy Halloween...!!



"I USE TO SCARE CREDIT UNIONS ON HALLOWEEN WITH THIS...

BOO !!

... BUT NOW I USE THIS...

Thursday, October 30, 2014

Rants and Raves...



Mitchell News-Journal
www.mitchellnews.com
*  I'm a person of faith, but I have no patience.

*  Webb Funeral Home serving the community since 1925, with only the best at a lower cost.  Budget plans  available.  Pay as you go!

*  We're Ebola ready for you, but more volunteers are needed! 

*  Gay folks can get married, but we all have free will.  God don't change, we do.

*  Saw where those Islamic jihadi suicide bombers are promised 73 virgins in Heaven; what does Allah promise to the virgins?  My wife told me to ask.

And this week's "run that by me one more time" classic....

Wednesday, October 29, 2014

Big Mc ?....


Mc matters ?
We all hope so!
Well !!  Seems we may finally have a "new sheriff in town" down on Duke Street, Alexandria! As you probably know, new NCUA Board member Mr. Mark McWatters is off to a fast, positive start - after just one meeting!

And, the buzz of hope and optimism is palpable within the credit union community - east, west, north, south, large and small.  Many who had "given up" on the NCUA, once again have their fingers crossed, hoping for a prophet of strength and character "to lead us up out of Egypt". The timing could not be better, nor more crucial for the credit union movement.


Not again !!
For those who may have come in late, the first "scene" occurred during a perverse little exchange at the last NCUA Board meeting, when Mr. McWatters simply called for a fresh look at the mounting fraud losses being experienced by the NCUSIF. Innocent enough, pretty sound advice. But the Chair seemed to unnecessarily take offense stating (CUJournal, 10/23/2014): "I take exception to that comment.... Safety and soundness and sound regulation go hand in hand.  I want to make sure that is on the record."

Most reasonable folks might think you could do both - fraud focus and sound regulation - without "making a scene", but "making a scene", rather than making sense has been "the soup de jour, the mess a la mode" on Duke Street of late.

Maybe regular ol' credit union folks just don't understand "D.C. principles and protocols", we just "don't get it" and Mr. McWatters' comments really were some sort of intricately subtle, underhanded "BIG Mc ATTACK".

But most folks certainly don't think so and are really, really happy with the new look at NCUA...

Tuesday, October 28, 2014

Without a Shadow Of A Doubt...



The Agency has just released its latest video on enterprise risk management for credit unions.

"We are pleased once again to be at the very  forefront of risk management with robust analyses of potential risks which you would never ever have thought about without our help.  When we worry, you should worry!  After all, we must protect the NCUSIF; folks would think we weren't competent if we bankrupted the Fund again!  

So, we're out to identify any and all risks; and, to make sure that you write a plan to manage each of them. Remember, NCUA is a stakeholder in your credit union! We must manage your credit union while you write plans, since you don't have the time to manage while you're writing plans, which come to think of it sounds like another risk for which you should plan.

But, before we do that one here's the new video entitled:  

"A New, Dark Risk Every Credit Union 
Should Fear"

Monday, October 27, 2014

Awaiting The "Second Coming": Are You Listening...?


You really wouldn't try that,
would you??

As most credit union folks know, getting NCUA to listen to reason and common sense is about as difficult as trying to baptize a cat.

If "listening sessions" were so important the first go round, wouldn't it make sense to schedule another series, during the second comment period? Or is all "the listening" over? 

The first RBC rule was simply inept and replete with "amateur hour"-type errors, now readily acknowledged by all as bizarre, downright foolish, just plain silly

But there in lies the problem!  So much energy and effort was required to overcome the initial nonsense that the real key issues have yet to be debated, nor "listened to"....  

Such as the rewriting of Congressionally approved statutes through an unchallengeable and seemingly unconstitutional regulatory process;  the arbitrarily imposed "individual minimum capital requirements", rubber-stamped by a poorly orchestrated appeals process, which is in fact a laughable fiction; the redefinition of credit union capital and net worth based on "whim and bias" unproven by either research, nor practical experience; the callous castration of a highly important, perhaps crucial, credit union dual chartering system....


All brought to you again,
 in the "Second Coming", by....

Sunday, October 26, 2014

Awaiting The "Second Coming" Of The RBC: Crocktoberfest...



From The NCUA Report
(April 2011):

"Four Tips For Effective Comment Letters"

1)  "Does NCUA really read all comment letters on every proposed rule? Yes!"

2)  "Do comment letters really lead to rule changes? Yes!"

3)  "I assure you: NCUA is open-minded about workable solutions consistent with sound public policy."

4)  "Before we finalize any rule, we then deliberate internally. We consider changes based on the comments. And we talk through different scenarios about how a revised rule might play out over time.... we take it very seriously. "
"We look forward to reading your comment letters."



 


We, We, We ?
Four Tips For NCUA
(October, 2014)

1)  Consider asking for input and opinions - in an open, transparent, "all stakeholders at the table" dialogue -  before you write the proposed rule.  Despite what you may believe, most of your "stakeholders" are not stupid, may actually know something about the operation of a credit union, are equally concerned with strong/fair regulation, and also ..."take it very seriously."
2)  Stop looking for new Credit Union rule ideas by "dumpster-diving" over at the FDIC - despite those past, copycat  "Suze Orman Teeth and Jacket" ads: 

"There is a difference".

3)  Try to at least feign humility - the "Royal WE" is so very unattractive.
4)  And, note the growing signs that many of your "stakeholders" think that the current rule-making process at NCUA discourages participation, suffers from a lack of credibility, and is frequently viewed as just a ....

Saturday, October 25, 2014

Mr. McWatters Tries To Explain To The Chair That She Is Confusing Cause And Effect....


Not too difficult to understand why NCUA CFO Mary Ann Woodson, a 35 year veteran, is hanging it up and calling it quits after listening to the little "dialogue " last week between Chair Matz and Director McWatters at the NCUA Board Meeting. 

At the meeting, during CFO Woodson's financial report, McWatters correctly pointed out that most NCUSIF losses were coming from small credit unions.  A true statement to which Chair Matz "took exception".  A veteran like Ms. Woodson understands that it is only a matter of time before another, similar "dialogue" will reoccur; and that the Chair will eventually turn to her and ask for her opinion as CFO on the disagreement.
 
Ms. Woodson is a highly regarded leader, ethical and principled - prone to tell the truth!  And, it is well known within the Agency, that "speaking truth to power" under the current regime has a tendency to be fatal.  Yes, Ms. Woodson a very good time to retire....Bon Voyage!!


HERE'S ANOTHER "REPRINT" TO VALIDATE THAT MR. MCWATTERS "GOT IT RIGHT" ... AND THAT THE CHAIR STILL ISN'T LETTING THE FACTS GET IN HER WAY:



Those Large Risky CUs !!!
"With more than $1 trillion in industry assets, deposits at federally-insured credit unions are protected by a fund of just over $11 billion.  However, four credit unions each has assets of $10 billion or more.  So, each of those four has assets nearly the size of, or greater than, those of the Share Insurance Fund."

 - NCUA Chair Debbie Matz, 9/18/2013

Oh Really....

Friday, October 24, 2014

Mr. McWatters Has Arrived: A Breath Of Fresh Air (At Last!) At NCUA?


Draw your own Conclusion!
According to the CUJournal (10-22-2014), Chair Matz and Mark McWatters got into a little "tiff" at the recent NCUA Board meeting over the issue of how to reduce the fraud losses paid by the NCUSIF.  

Chair Matz continues to harp (incorrectly!) on "the threat" posed by larger credit unions, while Mr. McWatters suggests that NCUA should focus on the facts, which clearly indicate that most fraud losses arise in smaller credit unions.  Facts and actual data have, of late, been considered as little more that an "inconvenience" by the current NCUA leadership, - especially when the facts conflict with the narrow-minded biases of NCUA's entrenched "ridiculocracy". 

Here's a "reprint" from earlier this year which shows that  Mr. McWatters is right....  LARGER CUs ARE NOT THE PROBLEM AT NCUA:



ACCORDING TO:

The NCUA Report
September 2013

"The [2008 financial] crisis showed that credit unions and regulators must be forward-looking and identify emerging risks sooner.  For example, credit unions cannot simply reach for higher yields without considering long-term consequences."  

"This is why NCUA issued a rule requiring credit unions to plan for interest rate risk and why we proposed allowing qualified credit unions to use derivatives to manage that risk.  We also created the Office of National Examinations and Supervision [the "ONES"] to focus on credit unions that pose the largest risks to the Share Insurance Fund."


WELL, THE RESULTS ARE IN BOYS AND GIRLS:


EVERY ONE OF THE 25 LARGEST CREDIT UNIONS IS WELL-CAPITALIZED!!
(As Naked Capitalism blogger Yves Smith would say: "Quelle surprise!")

NCUA's focus on credit unions with assets greater than $1 billion as "risky" has always flown in the face of the facts and NCUA's own actual history of losses from failing credit unions.  

Again for the record, that credit unions in this category pose "the largest risk" to the NCUSIF just because of their size is "robustly" delusional and falls victim to the classic analytical mistake of confusing size with risk. 

So let's do the geography, political risk analogy one more time.....

 

Based upon NCUA"s robust...

"SIZE = RISK" Theory,
The U.S. invaded the wrong country in 2001. After all Afghanistan is a country with a land area of only 250,000 square miles.

Clearly if "SIZE = RISK" then the U.S. should have invaded...

Thursday, October 23, 2014

The Future Of Your Credit Union: Inside The Box Thinking?


FROM THE OCTOBER 2014 ISSUE OF
THE NCUA REPORT

Found the following to be weird enough to make this blog! 
(And that's pretty weird - right!?)

(Oct. NCUA Report pg. 7)  "While credit unions face the challenge of discerning what is lurking around the next corner, NCUA also faces similar challenges.  How will changes in the financial marketplace alter the regulatory tools and skill sets required to fulfill our statutory mandate to protect the system?"

"The future is indeed like that box of chocolates.  We don't know what we are going to get.  But each of us must realize that disruption is an inevitable wildcard by testing every hypothesis relating to accepted financial norms.  It's time to start asking, "What would Forrest Gump do?"

NCUA's best advice on the future for CU's is:

IT'S TIME TO START ASKING, "WHAT WOULD FORREST GUMP DO?" ???

GUMP ?
Not really sure where to go with that advice, are you?  Should we ask Forrest Gump what to do about RBC or has NCUA already asked?

Actually, instead of relying on Forrest Gump;  believe the NCUA should internalize what Forrest's mother told him...

Wednesday, October 22, 2014

RBC: Waiting On "The Second Coming"... A Gnawing Concern?


SOME REALLY GOOD NEWS! 


A "Robust"- Based Capitol?
 THE AGENCY HAS POSTED AN UPDATE ON YOU TUBE, CONCERNING HOW THE WORK IS COMING ALONG ON THE REVISIONS TO THE RISK-BASED CAPITAL (RBC) RULE!

YOU CAN LOCATE IT RIGHT AFTER THE ECONOMIC FORECAST VIDEO !! SAME VEIN, SAME LINE OF THOUGHT, SAME IMPORT!!

HERE TAKE A LOOK...