Courtesy of Rajashree Chakravarty, BankingDive
May 5, 2023 — Requiring lenders to gather data on borrowers, including those from nonwhite-, LGBTQ+- and women-owned small businesses, would eliminate small lenders from the market, plaintiffs argued.
A Texas bank and the state’s trade group filed a lawsuit allenging the Consumer Financial Protection Bureau’s rule requiring lenders to gather and report small business loan demographic data, according to a court filing seen Wednesday by Bloomberg Law. Read more
April 14, 2023 — The Texas State Securities Board joined the Alabama Securities Commission and the Montana Securities Commission in filing enforcement actions to stop a fraudulent artificial intelligence investment scheme. The actions accuse YieldTrust.ai and Stefan Ciopraga of illegally soliciting investments tied to a decentralized application (dApp) that purportedly uses quantum artificial intelligence to trade digital assets. The initial scheme recently collapsed, and the respondents are now allegedly perpetrating a Ponzi scheme by raising capital from new investors to cover withdrawals from previous investors. Read more
Courtesy of Caitlin Ostroff, WSJ
Mar. 3, 2023 — Texas regulators are renewing their objections to a proposed deal for bankrupt crypto lender Voyager Digital to sell its customer accounts to the American affiliate of the world’s largest crypto exchange.
The agreement between Voyager and Binance.US got preliminary court approval last month despite objections from state and federal regulators, including the Texas State Securities Board and the Securities and Exchange Commission. Read more
Courtesy of Frank Gargano, American Banker
Feb. 3, 2023 — Citizens State Bank in Woodville, Texas, is selling one of its five branches to First Central Credit Union in Waco, Texas.
The $264 million-asset Citizens State announced Friday it had signed a purchase and assumption agreement with the $149 million-asset First Central to acquire the bank’s branch in Marlin. Under the terms of the deal, First Central will acquire real estate, personal property, loans and other assets and liabilities tied to the branch — which recorded roughly $26.3 million of deposits and $3.7 million of loans at the end of the fourth quarter. The deal is expected to close by the end of the first quarter.
Credit union purchases of banks and related assets have increased over the last several years, with 16 deals announced over the course of 2022 and 13 agreements in 2021. In the first such deal announced this year 4Front Credit Union in Traverse City, Michigan, acquired Old Mission Bank in Sault Sainte Marie, Michigan. Read more
January 11, 2023 — The Texas CUD recognized Isabel Velasquez, Executive Assistant to the Commissioner, and her forty years of service to the Department. Over the course of her tenure, she has worked with six of the seven, Texas commissioners.
Isabel keeps an upbeat attitude while assisting department staff and industry stakeholders. She is always friendly, professional, and willing to help others whenever the need arises. Almost every Texas chartered credit union leader knows her on a first-name basis. Additionally, she was the CUD’s “go-to person” whenever assistance is needed.
Ms. Velasquez is the Department’s longest-tenured employee beginning her career with the Department on November 15, 1982, and has assisted the following Commissioners during their terms:
- John J. Parsons Feb. 1974 to June 1985
- John R. Hale Sept. 1985 to June 1993
- Robert (Bob) Rogers Sept. 1993 to Oct. 1995
- Harold E. Feeney Feb. 1996 to Dec. 2018
- John J. Kolhoff Dec. 2018 to July 2022
- Michael S. Riepen Oct. 2022 to present
Nov. 4, 2022 — Cornerstone League and Heartland Credit Union Association (HCUA) members have voted in favor of a merger between the organizations. Of the 283 members who voted, 263 Cornerstone and HCUA members have voted in favor of the merger, clearing the path for the consolidation of the two entities.
HCUA members voted Oct. 24-28 while Cornerstone’s members voted in a special membership meeting on Monday morning. The final tallied results: HCUA members voted 121-17; Cornerstone members voted 142-3. The organizations are preparing to be fully integrated by Dec. 31, 2022 under the Cornerstone League brand, led by President/CEO Caroline Willard.
Sept. 29, 2022 — The National Association of State Credit Union Supervisors (NASCUS) welcomes new Texas Credit Union Commissioner Michael Riepen, beginning Oct. 1, 2022. Mr. Riepen formerly served as the Department’s Director of Examination Support. Before that, he served as President and CEO of Texas DPS Credit Union for 26 years. He holds an MBA in Finance from the University of Missouri-Columbia.
“NASCUS would like to congratulate Mr. Ripen on his new role within the Texas Credit Union Department. He brings a wealth of credit union regulatory experience,” commented Brian Knight, NASCUS President and CEO. “We look forward to working side by side with him to positively enhance the state system regulatory environment.“
“I am honored to accept this position and build on the achievements of those leaders that have come before me, Riepen commented. “Credit unions play a very important role in the Texas economy, and the Department helps ensure the credit union system is best positioned to meet the challenges of the moment and of the future. I know firsthand the commitment of our staff to our mission, and I want to thank the Credit Union Commission for this opportunity.”
The Credit Union Department is the state agency charged with supervising, regulating, and examining Texas State-chartered credit unions to safeguard the public interest, protect the financial interest of credit union members, and promote public confidence in credit unions. Riepen replaces former Commissioner John Kolhoff, now the NASCUS Senior Vice President of Policy and Supervision.
Credit Union Commission Chair Jim Minge noted, “Mr. Riepen is uniquely qualified to lead the Department given the breadth and depth of his knowledge about the credit union system and his keen sense of emerging issues in the financial services marketplace.”
Collaboration consolidation Cornerstone/Heartland Merger
By Caroline Willard, President/CEO, Cornerstone League
Sept. 7, 2022 — Here’s a thought experiment for you. If Louise Herring were to somehow time travel to 2022, would she be proud of the legacy she built? What would she think of bankers’ attacks on credit unions, the interchange debate, or the hold financial technology has on consumers?
What would she do to ensure credit unions’ sustainability in today’s environment?
I believe the Mother of Credit Unions would draw from her famous quote, which encapsulates her resolve: “… the purpose of the credit union is to reform the financial system so that everyone can have his place in the sun.”
She would tackle the issue of ensuring credit unions’ sustainability by leveraging the gumption she displayed at 24 years old when she rode the bus to Estes Park, Colo., for the 1934 meeting that would establish the Credit Union National Association. She would tighten her focus, keeping her eye on the prize like she did when she ignored unfriendly comments and stares from her colleagues in those fateful days nearly 100 years ago.
Her resolve prevailed as she signed the original constitution for the national association that became CUNA, later co-founded the Ohio Credit Union League, and organized more than 500 credit unions.
And while in 2022 we find ourselves in a vastly different world, obstacles not unlike those Herring experienced still threaten our efforts to keep the credit union movement alive.
Which brings me back to her quote, “… the purpose of the credit union is to reform the financial system…”
Like Herring, I believe it’s time to reform the infrastructure that surrounds, supports, and advances our credit unions.
As certain forces seek to take us down, dismantle, and discredit the movement, we can mobilize our credit unions to do what we’re meant to do: provide unbridled access to affordable financial products and create financial well-being for all, but in a transformative way. As I’ve challenged my colleagues in the last year to ponder the question “Will credit unions be around in 100 years?” I can’t help but draw a direct line between survival, collaboration, and consolidation.
Courtesy of Caroline Willard, Cornerstone League; featured in CUInsight
August 9, 2022 —It was the Senate bill heard round the credit union movement. On Thursday, July 28, Sens. Roger Marshall (R-Kan.) and Dick Durbin (D-Ill.) introduced legislation that would create new mandates on credit card issuers, affecting financial institutions across America.
Known as the Credit Card Competition Act, the bill would require covered credit card issuers to add a second network to their customers’ cards, allowing them to choose only from certain options set by the Fed.
We all remember the first time Sen. Durbin began his assault on interchange back in 2010, when he slipped the Durbin Amendment into the Dodd-Frank Act, capping interchange fees on debit card transactions for financial institutions with $10 billion or more in assets. The Federal Reserve approved a cap of 21 to 24 cents a transaction, down from an average of 43 cents that had been previously charged.
While issuers under $10 billion in assets were officially exempt from the interchange component of the regulation, downstream negative impact on interchange has indeed been felt by the small issuers.
Furthermore, a second component of Durbin 1.0 was a requirement for debit issuers – regardless of asset size – to maintain at least two unaffiliated debit card networks for merchants to choose from. The Durbin Amendment was basically a flop … and now Sen. Durbin is attempting a do-over.
Financial Services Industry Reacts
The Credit Card Competition Act was met with forceful objections by the financial services industry. A coalition of nine trade associations – including CUNA – issued the following joint statement, expressing that “this deeply flawed legislation from Senators Marshall and Durbin will undermine the significant safeguards and security that exist today to protect credit card payments.”
The American Bankers Association said the bill goes farther than the rules put in place for debit card transactions under the Dodd-Frank Act’s Durbin Amendment in 2010, where a financial institution could choose any two unaffiliated networks:
“Another new provision of the bill not found in the Durbin Amendment is a requirement that banks accept virtually any kind of transaction, functionally requiring banks to onboard potentially many more than two networks. Fed research shows that the Durbin Amendment had a negative impact on community banks and no demonstrated cost savings for consumers.”
Let’s pause for a moment and dig into this statement. Durbin 2.0 requires financial institutions to accept – as ABA put it – “virtually any kind of transaction,” eschewing carefully placed safeguards protecting consumers and financial institutions from fraud.
To onboard “potentially many more than two networks” is burdensome, especially if smaller financial institutions are forced to comply. In a world where they’re already burdened with quickly changing compliance and regulation laws, forcing this untested strategy upon them is unnecessarily risky.
In a June 30 article, American Banker wrote that “merchants have seized on the highest inflation rate in 40 years to argue that so-called swipe fees on debit and credit card purchases are too high. Because the charges, which retailers pay to banks, are capped based on a percentage of the transaction size, they rise as price tags climb.”
The Electronic Payments Coalition—one of the nine trades that issued the joint statement above—has a webpage dedicated to informing the public about interchange. (More on this later in the article).
March 1, 2022 — The merger of Texas Credit Union (formerly known as Texas Federal Credit Union) and Texas Trust Credit Union is complete.
The Texas Credit Union membership is now part of Texas Trust, a community-based credit union that offers competitive financial services for every aspect of life. Members can use the credit union’s online and mobile banking platform from virtually anywhere, making it easier to conduct their daily financial business anytime.. For members who prefer to do business in person, they have access to 22 locations to serve them.CEO of Texas Trust Credit Union Jim Minge
Being part of Texas Trust gives members access to competitive financial services that will enable them to buy or refinance a home, purchase a car, truck, or an RV, along with products to help them save for retirement or finance a business venture.
“Our employees worked diligently throughout the conversion to make the transition seamless for our new members from Texas Credit Union,” said Jim Minge, CEO of Texas Trust Credit Union. “Now that the merger is complete, we hope these members will leverage all of the great services we offer so they can make Texas Trust their primary bank.”
Minge added, “The merger also gave us a new presence in a prime location on Pleasant Run Road near I-35 in DeSoto. This branch will help increase our ability to serve this growing and diverse market.”
Courtesy of Unity One Credit Union
February 1, 2022 — Today, Unity One Credit Union announced the promotion of Scott Ward to president and CEO of the credit union. Ward’s promotion was confirmed by the board of directors last week and follows the previous CEO’s retirement.
Ward has been with Unity One Credit Union for 34 years. In that time, he has held numerous positions including loan officer, branch manager, chief operations officer, and most recently, president. Ward has led the credit union through many changes during his tenure and is looking forward to utilizing that experience in his new position.
Ward, originally from Wisconsin, holds a degree in Economics from the University of Wisconsin. He began working for Unity One while the credit union’s headquarters were in St. Paul, Minnesota. Ward then transferred to Fort Worth as the credit union’s headquarters were relocated in the early 1990s.
“We are very fortunate and pleased to have someone with as much experience, capability and knowledge as Scott to be appointed to the CEO position at Unity One Credit Union,” said Vince Accardo, Chairman of the Board of Directors for Unity One. “Scott has been the Chief Operating Officer for the past 23 years and has done an outstanding job. In addition to a deep understanding of the operations of Unity One, he is very focused on the overall Credit Union membership experience. The Board of Directors at Unity One has tremendous confidence in Scott’s ability to lead Unity One in the years to come.”
November 29, 2021 – The National Association of State Credit Union Supervisors (NASCUS) is proud to announce the Texas Credit Union Department has earned Reaccreditation following a series of in-depth reviews and assessments by a panel of veteran state supervisors.
“Reaccreditation demonstrates the value we as examiners and an agency provide to the industry and its members. Our credit union examination department ensures compliance with our laws while following best practices to meet the highest national standards in our supervision of more than $54 billion in assets across 175 credit unions. I am proud of our team for receiving the NASCUS Reaccreditation.” commented John J. Kolhoff, Commissioner, Texas Credit Union Department.
NASCUS Accreditation is a robust process that includes disciplined self-evaluation, peer review, and ongoing monitoring. The process, administered by the NASCUS Performance Standards Committee (PSC), measures a state regulatory agency’s ability and resources to carry out its regulatory and supervisory programs effectively.
June 10, 2021 — On Friday, June 4, 2021, Texas Senate Bill 707 was signed into law by Texas Governor Greg Abbott, extending the Credit Union Department of Texas operations until 2033.
The Texas Sunset Advisory Commission recommended the 12-year extension, stating, “Texas-chartered credit unions have fared well under the state’s current regulatory framework; the Sunset Commission again found the existing organizational structure is the best option and transferring the department would have no benefit at this time.”
John J. Kolhoff, Commissioner of the Credit Union Department, for the state of Texas, commented, “I would like to express my gratitude for the independent review by the Sunset Advisory Commission, the incredible efforts of our staff, the leadership of the Credit Union Commission and the support of the industry.”
Mar 25, 2021 — The first virtual Texas Governmental Affairs Conference was held March 22 and featured visiting Texas state representatives, a special roundtable discussion between the Texas Credit Union Department and National Credit Union Administration, a Q&A session, and a legislative update from Cornerstone League leaders. The event was hosted by Texas Credit Union Association and Executive Director Gili Carter.
Mary Ann PerezRep. Mary Ann Perez (D-Pasadena) discussed her bill, HB 2106, which she called a “clean-up bill” for those passed in 2019. HB 2106 relates to the prevention, identification, investigation, and enforcement of payment card fraud and provides a civil penalty. Card skimming is the use of electronic card devices used to steal credit card information from consumers and results in millions of dollars in losses for financial institutions.
Perez was able to pass three laws in 2019 through the House of Representatives after months of negotiations with merchants, law enforcement agencies, and financial institutions. HB 2945 related to payment card skimmers on motor fuel dispensers and to creating a payment fraud fusion center; imposing civil penalties; and creating criminal offenses. HB 2624 authorized prosecution and HB 2625 provided penalties to criminals.
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