tag:blogger.com,1999:blog-319775530671726401.post5184118103874356308..comments2023-10-01T09:18:26.162-04:00Comments on Keith Leggett’s Credit Union Watch: Pig-in-a-PokeKeith Leggetthttp://www.blogger.com/profile/14794334790117033547noreply@blogger.comBlogger11125tag:blogger.com,1999:blog-319775530671726401.post-75898669704194503052010-03-05T17:38:13.313-05:002010-03-05T17:38:13.313-05:00Actually, no.
Its YOUR challenge to convince.
Co...Actually, no. <br />Its YOUR challenge to convince. <br />Convince the Congress, Treasury, Fed Governor Bernanke (who recently threw a bucket of ice water)on the idea that CUs should get a higher MBL cap when a vast majority of CUs dont care and when there is a mountain of fact and data that the agency wasnt able to regulate what they already have.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-319775530671726401.post-69312185211765133302010-03-05T15:33:34.281-05:002010-03-05T15:33:34.281-05:00My challenge to you is to prove, or at least show ...My challenge to you is to prove, or at least show any evidence at all, that MBL is the SUV.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-319775530671726401.post-14029433409106967602010-03-02T20:52:44.942-05:002010-03-02T20:52:44.942-05:00"general carelessness". Interesting. $40..."general carelessness". Interesting. $40B in "toxic assets" carelessness in an $80B equity industry. So, they ride a bicycle and run over everyone in their path and when they finally get to the garage, you'd hand them the keys to the SUV.<br />As for performance on mbl's before the cap? There were almost no mbl's being written and it was the beginning of a long term economic expansion.<br />As for mbl performance on the books now?<br />Give it a little more time, but what ever you do, stay out of the road, here comes the SUV.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-319775530671726401.post-88880737496293524172010-02-28T11:21:07.790-05:002010-02-28T11:21:07.790-05:00You're answer conveniently has nothing to do w...You're answer conveniently has nothing to do with business lending at credit unions, but is merely a rant against the general carelessness of the NCUA. The charge-off rates for business loans at credit unions are a fraction of what they are at their bank counterparts. Now, if you will actually look at credit union business lending practices during the time in which there was no legislative cap on business lending, and provide ACTUAL DATA that the risk exposure from business loans was GREATER than the period of 1998 to now, you may have an actual case based on something empirical.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-319775530671726401.post-72454942434299575392010-02-27T12:03:08.652-05:002010-02-27T12:03:08.652-05:00to anonymous above regarding, "what evidence ...to anonymous above regarding, "what evidence of risk exposure business loans posed to cu"s can you provide..."<br />Are you kidding?<br />What evidence do you need, besides whistling by the graveyard?<br />Are we to assume that the same agency that posted a field examiner at both USC and Wescorp DAILY and missed the tsunami of risk that simultaneously piled up in the investment portfolios of those 2 CCUs is somehow miraculously going to transform itself into a better examiner of safety and soundness on a loan type that it has alomst no experience with?<br />Whats more, how sure are you that MBLs have been underwritten with such care...take a closer look.<br />The same agency that brought you expanded investment powers for CCUs,opened up national FOMs for CCUs and then watched the larger CCUs cooperatively "eat their young" and then crater the system on "$40B in toxic assets" (according to Scott Hunt at a recent Town Hall)...if not for an $18B lifeline from the US Treasury, there would be no CUs to write MBLs.<br />The same agency whose general counsel stated about CCUs at a recent Town Hall, "providing above market rates while charging below market fees was doomed to fail"...which implies he saw the risk and IGNORED it? <br />One might ask what the agency is doing writing the US Treasury for anything other than forgiveness, but that aside, why write a letter asking for something that perhaps 500 of 7800 CUs even care about...while bad loans in CUs and losses in CCU investments are piling up?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-319775530671726401.post-80959685522802195452010-02-26T16:17:51.554-05:002010-02-26T16:17:51.554-05:00That implies that there are underlying negative co...That implies that there are underlying negative consequences to Matz misleading (in this hypothetical pig in a poke dilemma). <br /><br />Worst case scenario in the ABA's view: that the cap gets raised and the NCUA fails to live up to its word of regulating business lending. Even then, credit unions would be more impaired in their MBL authority than in the 28 years between the formation of the NCUA and the passage of the MBL cap. <br /><br />What evidence of the severity of risk exposure business loans posed to credit unions can you provide for this period of time that would lead us to suspect that even the NCUA's neglect of these responsibilities would be so critically damaging to the industry?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-319775530671726401.post-20516270013570117642010-02-26T14:29:00.436-05:002010-02-26T14:29:00.436-05:00It is not raising the cap, but rather her promises...It is not raising the cap, but rather her promises of enhanced oversight and revising NCUA's MBL regulations without spelling out the details that is the pig-in-a-poke. If the higher MBL cap were to become law, there is nothing that would compel NCUA to follow through on its promise to revise its MBL rules.Keith Leggetthttps://www.blogger.com/profile/14794334790117033547noreply@blogger.comtag:blogger.com,1999:blog-319775530671726401.post-57088084086687563432010-02-26T14:19:39.696-05:002010-02-26T14:19:39.696-05:00Sorry, could you explain in greater detail how rai...Sorry, could you explain in greater detail how raising the MBL cap is a pig in a poke? Trying to understand what your underlying logic is behind that statement.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-319775530671726401.post-25570574730634089622010-02-26T13:26:31.151-05:002010-02-26T13:26:31.151-05:00Just the opposite. The banks got stuck as the gov...Just the opposite. The banks got stuck as the government altered after the fact the terms of the Capital Puchase Program.Keith Leggetthttps://www.blogger.com/profile/14794334790117033547noreply@blogger.comtag:blogger.com,1999:blog-319775530671726401.post-31786853834475310742010-02-26T13:18:52.832-05:002010-02-26T13:18:52.832-05:00Isn't the banks use of TARP funds a better exa...Isn't the banks use of TARP funds a better example of a "Pig in a Poke".Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-319775530671726401.post-87182560848157234772010-02-26T12:17:03.875-05:002010-02-26T12:17:03.875-05:00Not sure I see how the idiom works in this context...Not sure I see how the idiom works in this context.Anonymousnoreply@blogger.com