WASHINGTON – During her six-and-a-half years on the NCUA Board, the low point for JoAnn Johnson undoubtedly was her grilling before the House Ways and Means Committee in November 2005, while she was still getting her sea legs as chairman of the board.
At that hearing, held 18 months after she was named Chairman of NCUA, Johnson was brought near tears by a withering interogation by California Congressman Bill Thomas, who was then chairman of the tax-writing panel.
“That was definitely the turning point for her,” said one long-time credit union lobbyist last week, when dozens of NCUA employees gathered at the agency for a teary-eyed going-away ceremony for Johnson.
Soon after what was widely considered a disastrous showing before the congressional panel, Johnson dismissed her top staff and adopted a more take-charge demeanor, which she exhibited in numerous subsequent appearances testifying before Congress.
“The hubcap almost fell off during that hearing,” noted Len Skiles, executive director for NCUA, last week. Skiles was at the Ways and Means and all subsequent congressional hearings.
“But good things happened” as a result, he said, as Johnson went on to challenge herself and her staff; learned the lessons from the congressional grilling; ending up testifying before Congress a total of 12 times – more than any other NCUA Chairman.
The self-described Iowa farm girl, who was appointed to the NCUA Board in 2002 by President George W. Bush, went on to make a mark at NCUA and on the credit union movement in a variety of ways. First, by carrying on initiatives begun by her predecessors to reward well-run, “Reg-Flex” credit unions, and by continuing to champion risk-based capital.
But Johnson might be remembered best for her championing of the rights of the consumer – the tens of millions of credit union members. She led the way in toughening member disclosure requirements for credit unions converting to mutual savings banks. That led to additional efforts to expand member access to credit union books and records and to enforce member rights as expressed in the standard bylaws applied to every credit union. And the shift away from the magical 1% return-on-assets benchmark, so that credit unions could be encouraged to return more to their members.
Uncompleted efforts to increase member access to executive compensation and other important information are expected to be continued by her successors.
“The member has been the common denominator in NCUA’s work in these areas and the central animating principle that I have tried to bring to my regulation of credit unions,” said Johnson in her valedictory.
In the end there was one failure, she lamented, the same one shared by all of her predecessors at NCUA – the continued acrimony between credit unions and banks. “I could never understand the aggressiveness on the part of the banks when credit unions are there to serve people,” said Johnson last week. “There’s room for both.”
