Oh Boy! what is that Note and what did you do with it?

[dashboy]

You better read what the SEC says about that Note and what the bank can do with it! hahaha!

http://www.sec.gov/rules/final/34-47364.htm#P167_40335

dashboy~

[Livefire]

dahsboy, I like their use of the word SYNDICATE!!!!

[dashboy]

SINdicate it is!! Did you get a load of the talk about riskless priciple transactions and asset backed transactions?

dashboy~

[Judge Roy Bean]

Welcome to the round earth.

[charlesa6]

Hehehehehe. Very Funny.

[dashboy]

Judge,

I think we were looking for a little more input than that. What is your take on this point that has been codified concerning:
Final Rule:
Definition of Terms in and Specific Exemptions for Banks, Savings Associations, and Savings Banks Under Sections 3(a)(4) and 3(a)(5) of the Securities Exchange Act of 1934

Securities and Exchange Commission

17 CFR Part 240

dashboy~

[Judge Roy Bean]

Originally Posted by dashboy

Judge,

I think we were looking for a little more input than that. What is your take on this point that has been codified concerning:
Final Rule:
Definition of Terms in and Specific Exemptions for Banks, Savings Associations, and Savings Banks Under Sections 3(a)(4) and 3(a)(5) of the Securities Exchange Act of 1934

Securities and Exchange Commission

17 CFR Part 240

dashboy~

The 2003 final rules are relevant to the bank entities being allowed further into the securities business than they had been previously, such that they don't have to register with the SEC as "dealers" and "brokers" for certain types of transactions. It also expanded their ability to deal in asset-backed securities.

The banks, in general, have always had a dim view of the limitations some of their non or less-regulated competitors don't have and are constantly working in Washington to expand their scope of operations. Typically, the regulations promulgated in this environment have little regard for how these quasi-regulated businesses can abuse consumers. It is much like seeing sausage being made; once you've seen it, you'd probably never eat it again.

Our elected representatives frequently abbrogate their responsibility to protect consumers; they point to the extant regulators and say "draft rules and regulations" and then pat themselves on the back while those supposedly regulated play footsie with the regulators in getting what they want.

[dashboy]

Anyway,

I found some other interesting tidbits online. A 2005 Federal Credit Union accounting manual off the NCUA website. Here is a short reem of info contained within:

SERVICING ASSETS
When a credit union sells whole loans or participations in loans, the credit union often retains the right to service the loans. A credit union may also service credit card receivables or other financial assets. This asset category represents the economic value of these servicing rights. Further discussion of this topic is outside the scope of this manual. Credit unions involved in servicing loans or other assets should seek the guidance of an independent accountant.



ACCOUNTS RECEIVABLE
Receivable accounts are used to record claims of the federal credit union for money, goods, or services from other entities or persons. The primary "trade debtors' accounts" of a federal credit union are evidenced by loans to members and other notes and contracts receivable which are discussed in the “Loans” section of this manual.



Payroll Deductions Receivable
This account is used to record payroll receivables from members' employers prior to the credit union's receipt of the funds by check, magnetic or electronic media. A debit balance in this account indicates that an employer's payroll(s) was/were not received on the date(s) agreed upon by the employer and the credit union.


LIABILITY ACCOUNTS
Every liability account should be supported by subsidiary ledgers for each payable item in the accounts. These subsidiary ledgers should reflect the initial credit to the account, date established, periodic debits and the remaining balance of each item in the particular General Ledger control accounts. These subsidiary ledgers need to be totaled and balanced to the respective General Ledger control accounts each month.



NOTES PAYABLE
Notes Payable-Other

This account reflects the liability of the credit union for funds borrowed. Such borrowings must be in accordance with the Federal Credit Union Act.

Entries in the Journal and Cash Record

This account is credited as a "Miscellaneous-Credit” with the amount of notes payable which have been executed and delivered to creditors, including notes to other credit unions. The account is debited as a "Miscellaneous-Debit" when the liability is wholly or partially liquidated.

CERTIFICATES OF INDEBTEDNESS

PROMISSORY NOTES
Some credit unions borrow money from members or nonmembers and issue promissory notes, formerly called certificates of indebtedness or a similar name. Issuance of promissory notes is governed by Section 701.38 of the NCUA Rules and Regulations. The offering of promissory notes will necessitate the maintenance of a subsidiary ledger. If the note provides for payment of interest less frequently than the credit union's accounting period, consideration should be given to accruing the interest not less frequently than the end of each accounting period so that the cost of the borrowed money can be allocated to the periods during which the expense is incurred. The accruals should be recorded as "Accrued Interest Payable". Among the items to be considered for inclusion on the note are:

· Certificate number, pre-numbered for control purposes.

· Date of issue.

· Credit union name and location, and name and address of lender.

· Amount of the certificate or space to record the amount.

· Interest rate and method and time of payment of interest. Also, whether there would be any penalty for early redemption and whether interest will continue to accrue after maturity.

· Maturity date. Conditions for early redemption, including but not limited to where and how it may be redeemed.

· Provisions for signature of the treasurer and countersignature of the president.


This is all so fun!

dashboy~