WASHINGTON – National Credit Union Administration board members want to make it easier for CUs to lend their members.
"A top priority became making it easier for you to do business," NCUA Chairman Debbie Matz said Monday during her address to the Credit Union National Association Government Affairs Conference here. "We needed to change our culture, to reset the default switch to 'yes.' Too often in the past, that default switch was set to 'no.' ".
The NCUA has taken a number of steps over the last year to help credit unions lend more by easing regulations, including removing a cap on infrastructure investments, increasing how much credit unions ability to lend to businesses and plans to implement field-of-membership changes that would allow credit unions to expand their jurisdictional reach.
Matz credited the changes as part of a "modern regulatory framework" that ensures regulations are "cost-effective and balanced."
NCUA board member J. Mark McWatters who spoke at the same conference later in the day also called for freezing new regulations.
"The NCUA should declare a moratorium on the issuance of any new material rules…at least for a reasonable period of time as we assess the totality of credit unions' regulatory burdens," McWatters said and added that "to the greatest extent possible - deal with individual problem issues through the supervisory process."
"It is puzzling that credit unions are so highly regulated," McWatters opined.
McWatters, who released a list of "21 thoughts" of what regulatory relief should look like also advocated for improving credit union's recourse if they feel an examiner has come to an unfair determination.
"The NCUA should ensure that examiners conduct their operations in a manifest and accountable manner by avoiding the 'because I say so' mentality that seldom works even with two-year olds," he said. "The NCUA should disclose in writing to credit unions the legal, financial, accounting, and regulatory basis of their examination findings and actions."
He also said the NCUA Inspector General hotline to report inappropriate behavior such as intimidation or retaliation taken by an NCUA examiner or independent contractor should be expanded.
Matz also touched on places growth opportunities for credit unions including a recently signed agreement with the U.S. Treasury Department that will "give hundreds more credit unions access to the Community Development Financial Institutions Fund, which provides multi-million-dollar grants to serve economically distressed communities."
"We're striving to double the number of credit union participants, by cutting red tape in the application process," Matz added.
But the bigger opportunity is the $30 trillion that will be inherited by millennial's from baby boomers in the coming years.
"Making millennials into members, keeping pace with evolving technology and adopting strong cybersecurity measures will determine the future of your credit union," Matz said.
McWatters, whose stay at the NCUA may only short-lived after being nominated to the board of the Export-Import Bank in January by President Obama, also offered a few words of advice on pursuing regulatory relief. (McWatters still needs to be confirmed by the Senate before he can take the position).
"Most of what I am suggesting will not require a new law, yet without insistence from Congress, I fear business as usual will continue at the NCUA and more rules will follow," McWatters said.
He also added that: "The NCUA should work with the [Federal Deposit Insurance Corp.] and Comptroller of the Currency to thoughtfully minimize any ill-considered and adverse impact of the FASB's efforts to change reporting of possible credit losses at credit unions and community banks."
