Dear NCOFCU Community, In Washington, influence is rarely granted to those who speak alone. It is earned by coalitions that are coordinated, credible, and impossible to ignore. For the credit union movement—founded on cooperation—this principle is especially important. That is why we want to share our perspective on the growing importance of collaboration between the National Council of Firefighter Credit Unions (NCOFCU), the Defense Credit Union Council (DCUC), and America’s Credit Unions (ACU). NCOFCU represents a unique and deeply meaningful segment of our industry: credit unions serving first responders. These institutions support individuals who face extraordinary risks in their daily lives, and their financial needs reflect that reality. Ensuring their voice is heard in policy discussions is central to our mission. At the same time, DCUC represents credit unions serving military members, veterans, and defense communities—another mission-driven segment...
Growing Use of Stablecoins Could Reshape How FIs Manage Liquidity, Allocate Assets, NY Fed Report Suggests
NEW YORK — The growing use of stablecoins tied to the U.S. dollar could reshape how banks manage liquidity and allocate assets, potentially leading institutions that support the digital tokens to hold more reserves and make fewer loans, according to a new study from the Federal Reserve Bank of New York . The paper, titled “ Stablecoin Disintermediation ,” was authored by economists Michael Junho Lee and Donny Tou and examines how stablecoin activity affects the balance sheets and liquidity management of banks that partner with stablecoin issuers. The researchers found that while stablecoins rely on traditional banks to function, the relationships can alter the liquidity demands placed on those institutions. Banks serving stablecoin issuers tend to hold larger reserve balances and reduce the share of assets devoted to lending, shifting toward a more reserve-heavy banking model. Focus of Study The study focused on developments following the March 2023 collapse of...