WASHINGTON – The credit union lobby was calculating yesterday what effects the pending retirements of two Democratic senators, Banking Committee Chairman Christopher Dodd and long-time credit union ally Byron Dorgan, will have on legislation to reform the financial services markets.
Yesterday’s announcement by Dodd, the Connecticut Democrat, that he won’t seek a sixth term, is sure to roil the legislative process as the massive financial services reform bill passed by the House just before Christmas moves to his committee. But the retirement of Dorgan could be just as meaningful for credit unions, according to observers.
"He [Dorgan] was always a reliable vote," said Fred Becker, president of NAFCU. "He was very supportive of co-ops and very supportive of the [credit union] industry," said Becker of the Democrat from North Dakota, where agricultural cooperatives are very influential.
Dodd’s support of credit unions, even as chairman of the banking panel, has been less obvious. He recently stated he saw no need to combine NCUA with banking regulators as part of a regulatory consolidation plan. Late last year he helped move legislation that fixed the 21-day notice controversy in the credit card bill.
Dodd’s announcement comes as his committee is poised to take up the historic financial reform bill which would create a consumer financial protection agency, a systemic risk regulator for "too-big-to-fail" financial entities, set new regulatory schemes for financial derivatives and Wall Street ratings agencies, and allow shareholders some say on executive compensation. But there is little in it that will directly affect credit unions. That’s because the version of the bill passed by the House probably would exempt all credit unions from examinations by the consumer agency and also would exempt credit unions from the too-big-to-fail agency.
NAFCU’s Becker, noting Republican opposition, said plans for the consumer agency will continue to be a tough sell in the Senate. "Regulatory reform is going to go forward. The CFPA has always been a tough row in the Senate and will continue to be a tough row," said Becker.
CUNA President Dan Mica served with Dodd when the two were in the House in the 1990s. "I have had many occasions to work with him in the ensuing years, both as a member of Congress and as an advocate for credit unions," said Mica in a prepared statement. "On a personal level, we developed a close relationship, for which I am grateful. On a professional level, I have always found him to be open-minded but resolute once he has reached a position. As chairman of the Senate Banking Committee he has always given credit unions fair consideration, which we have greatly appreciated."
