5SHARESShareShareSharePrintMailGooglePinterestDiggRedditStumbleuponDeliciousBufferTumblr While there are plenty of reasons people might choose a credit union over a bank, one big reason typically has been that credit union fees are often lower. This has especially been true of overdraft fees, but a new study finds that’s not the case anymore.According to financial services research firm Moebs $ervices, the median bank overdraft fee last year was $30, the same as it’s been since 2010. “From 2008 through the first part of 2015, credit unions maintained a statistical advantage with a lower [overdraft] price over banks,” Moebs said in its analysis. But by the end of the year, that had changed, with the median credit union overdraft fee rising to a very bank-like $29. It’s the first time since 2007 that credit unions haven’t had a statistical advantage over banks in their overdraft fees.From 2005 through 2011, credit union overdraft fees didn’t budge, with a median of $25 for that entire time, while the bank median shot up from $25 to $30 between 2007 and 2010, then stabilized. The report includes plenty of smaller banks and credit unions that charge less than the median, although Moebs finds that only about 2% of them—roughly 250 institutions—today charge less than $20 for an overdraft. continue reading »
However, the HBS as envisaged by EIOPA would impose solvency requirements or minimum funding levels, or act as a risk-management tool.In an interview with IPE, Bernardino said a harmonised system across the EU would allow cross-border funds to be in deficit, as long as they complied with the HBS framework.“If you want to remove the cross-border fully funded requirement, there needs to a be a higher level of harmonisation,” he said. “When you do these [HBS] consultations, you push people to think about the real economic elements of pension funds.“And if EIOPA does this, then we will have influenced the way the sustainability of pension schemes is addressed.”In October, the authority published a consultation providing six frameworks for the HBS, each either imposing solvency requirements or a minimum funding level, or presented as a risk-management tool.Bernardino said the risk-management tool would come with some funding consequences.The idea of solvency requirements for pension funds was initially expected to be included in the IORP II Directive, before being dropped by then commissioner Michel Barnier, after protests from several governments.However, the idea lived on, with EIOPA working on the HBS outside European Commission influence.“There is an intrinsic value in the work EIOPA is doing,” Bernardino said.“Cross-border pension funds highlight the true nature of the European internal market.“[But a cross-border] pension fund still has to report to countries in different fashions – it is completely sub-optimal.“If we move towards a sufficient, minimum level of harmonisation on technical provisions or solvency, we can have a better consistency and convergence, and there will be huge cost benefits.”The consultation runs until 13 January 2015.Bernardino also said its consultation on the HBS had not been done with an outcome in mind, and that the authority’s main aim was to be challenged by the industry.“We are open, and this is why we are consulting,” he said.“You need to have an idea, but the one I have is not a choice between framework one or framework six – it is to listen.”To read the full interview with Gabriel Bernardino, click here or see December’s issue of IPE magazine Cross-border funding rules for European pension funds could be relaxed by using the harmonised holistic balance sheet (HBS) model, the EU-wide regulator has suggested.Gabriel Bernardino, chairman at the European Insurance and Occupational Pensions Authority (EIOPA), said the consulted-on HBS would allow pension funds to operate across borders while running a deficit.Current rules stipulate that cross-border schemes must always have enough assets to match liabilities.Plans to encourage the growth of cross-border pension funds among multi-national companies have suffered, as they pose too much capital risk for corporate sponsors.