Hood Emphasizes Common Interests Between CUs, Banks

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In what is believed to be a first, a member of the NCUA Board addressed a bankers' meeting in an attempt to bring a patch of common ground to the two often-warring interests of banks and credit unions.

In his speech to the 110th Annual Convention of the North Carolina Bankers Association, NCUA Vice Chairman Rodney Hood tried to emphasize what banks and credit unions share in common.

"I firmly believe that credit unions and banks have a shared vision and common goals," Hood told the bankers. "In today's dynamic financial marketplace, credit unions, banks, and thrifts share a vision for successfully managing regulatory burdens while seeking to provide financial products and services to consumers in a cost-effective manner."

Such common goals would include regulatory relief; strengthening communities by protecting Americans from predatory lending, and promoting homeownership and entrepreneurship; data security; consumer education regarding the recent insurance fund changes; and support for the dual chartering system, he suggested.

"Banks and credit unions clearly have a shared goal in supporting regulatory relief." Hood said. "Regulation changes, especially for smaller credit unions and smaller community banks with limited staff can be quite costly since implementation often requires computers to be reprogrammed, staff retrained, manuals updated and new forms produced."

That regulatory challenge is only exacerbated by the post-9/11 environment, he added, saying "There is no doubt in my mind that financial institutions and the regulators must be vigilant in their efforts to implement the Bank Secrecy Act in order to prevent terrorist financing efforts and money-laundering," Hood said he would like to see banks and CUs work together to make the system more effective for law enforcement and more cost-efficient for themselves.

While there has been talk in some banking circles of going after CUs trying to expand member business lending, Hood tried to show how this, too, was an example of common ground.

"Small businesses with fewer than 500 employees account for 75% of all new jobs created in this country," Hood said. "As a former commercial lender, I know firsthand that banks and credit unions also strengthen communities through providing capital to small business owners, and have played a pivotal role in helping create the largest number of small business owners in history."

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