Secondary Capital To Take Center Stage, Cheney Says
SAN ANTONIO-CUNA President Bill Cheney said the trade group will make a priority out of secondary capital in 2011. Cheney offered that preview before NASCUS' annual meeting; secondary capital has long been an objective of the trade group representing state regulators.
In the short term, said Cheney, CUNA will continue to push hard in Congress for an increase in the Member Business Lending cap, including in the upcoming lame duck Congress, but its efforts will be "under the radar."
Separately, Cheney said he has now had three discussions with Elizabeth Warren, the de facto head of the Consumer Financial Protection Bureau, which is in the process of being formed and defining its mission. Cheney said his message to Warren has been that while simplifying product and service disclosures and regulations is an admirable goal, it must be accompanied by a peel-back of years' worth of regulations that are often duplicative or even conflicting. "One of the first things we're going to look at is mortgage lending," said Cheney. "Yes, we need simpler mortgage disclosures. But if you're going to eliminate that you can't just put a new regulation in place; let's first get rid of the stuff that makes this regulation so complex."
CUNA has also proposed that different regulations be considered depending on the size and sophistication of the institution.
In terms of pushing for capital reform, Cheney cautioned that the new Congress may be even more gridlocked than the current body.
"Everyone understands the need to have strong capital in the system for just these kinds of situations," said Cheney. "Even NCUA has now acknowledged that they see alternative capital, or supplemental capital, as a safety and soundness issue."