ARLINGTON, Va. — NCUA Vice Chairman Rodney Hood has a unique perspective on what CRA for credit unions might hold, given that he previously served as the CRA officer at a bank.
Though Hood said it's hard for him to speculate on how things could shake out with the latest push to impose some type of CRA on the credit union movement, he was able to offer some insight based on his time as CRA officer, as well as from the perspective of a CU regulator.
Noting that CRA "was for banks that were redlining," Hood maintains there is no reason to take such action against credit unions, since they do not redline.
"Credit unions continue to make mortgages, business loans," he explained. "Credit unions are serving their entire membership. Credit unions are going to continue to do the right thing."
Hood noted that because of all of the costs that would be associated with CRA compliance, credit unions would possibly have to increase their low rates on loans.
"While I enjoyed my role as a CRA officer, it was different. Credit unions are the only ones not contributing to the credit crunch," Hood said. "It takes a lot of activity. There will be expenses credit unions will have to incur. I think it would be really hard for credit unions. It could be a major burden. While I had that role in the past, and enjoyed it, I recognize what a burden it would be and what the cost would be."
Hood is curious to see how CRA compliance requirements for credit unions would compare to the requirements for banks.
"It's not apples to apples," he explained. "Credit unions are lending safe and soundly. We don't need legislation to get credit unions to do what they do innately — people helping people," adding that credit unions should also be recognized for "running payday lenders out of their markets."
