With the inauguration complete and Congress in session, the credit union trade associations are ready to bear down and get to work. Here’s a look at what the first full week of the Trump administration – working in tandem with the GOP-controlled Congress – has in store for CUs.
Reg freeze
Shortly after Trump’s inauguration, the White House
“This is pretty standard practice for an incoming administration,” noted Ryan Donovan, chief advocacy officer at the Credit Union National Association. CUNA on Friday called on the Consumer Financial Protection Bureau to issue its own freeze on rulemaking (excluding “protective relief”) and Donovan noted that the White House’s hold is consistent with CUNA’s.
FHA premiums
Along with the reg freeze, the Trump administration quickly announced the cancellation of a planned cut to FHA premiums. While some have cast the administration’s action as a move that could make home ownership more costly – particularly for some low-income borrowers – NAFCU said it “supports a reduction in the mortgage insurance premiums as it helps make mortgages more affordable to consumers and further advance[s] the housing recovery.” NAFCU said it will continue to fight for CUs’ equal access to the secondary mortgage market, as well as fair pricing based on loan quality rather than volume.
Congressional agenda
The House of Representatives will have an abbreviated week this week on account of the Republican conference retreat, with the House only in session Monday, Tuesday and part of Wednesday. No hearings of significance to CUs are expected in the House.
The Senate is expected to continue confirmation hearings, including likely approving the nomination of U.S. Rep. Mike Pompeo (R-Kan.) to lead the CIA, which would set up a special election for his replacement in the House. CUNA’s Donovan said that the Senate may also vote on the nominations of Dr. Ben Carson to lead HUD and Sen. Jeff Sessions as attorney general. The Senate Banking Committee is also expected to hold a confirmation hearing on Linda MacMahon’s nomination to serve as administrator of the Small Business Administration.
Alternative capital
In its January board meeting last week, NCUA announced a call for public comment on alternative capital for credit unions, including supplemental capital for the purposes of risk-based capital and for net worth and risk-based capital for CUs with low income designations.
CUNA praised the regulator for finally moving on the issue, which Andy Price, CUNA senior director and counsel, noted has been on the agency’s to-do list since the original risk-based capital rule was introduced several years ago.
“This is a good step toward starting that process,” he said. “They’ve asked some good questions that they put forth when they did the original risk-based capital [proposal]…so we look forward to providing comments and helping them shape that rule.”
Lucy Ito, president and CEO of the National Association of State Credit Union Supervisors, said in a statement that NCUA’s proposal "holds the potential for synchronizing federal rules with existing authorities already on the books for credit unions in 15 states, which is a long-time goal of NASCUS. There is much to be considered in the 50-page proposal, particularly the challenges it outlines. The state system, however, believes that these challenges can be overcome -- and that credit unions will ultimately have access to the tools they need to maintain safe capital levels during good and bad economic times.”
State issues
Along with Congress, 45 state legislatures are back in session this week, and the following credit union-specific bills are being debated:
- A bill to modernize the Nebraska Credit Union Act
- A data breach notification standards bill in New Mexico
- Supplemental capital and public deposits in Washington
