WASHINGTON — Rose Bartolomucci, president and CEO of Towpath Credit Union testified Wednesday before the House Committee on Financial Services on behalf of CUNA to advocate for regulatory relief the credit union community.
Bartolomucci, whose $114-million asset credit union is based in Akron, Ohio, is the former deputy superintendent for credit unions for her state's Department of Commerce. (Dublin, Ohio, is also the headquarters of American Share Insurance Inc., the last surviving private insurer of credit union deposits.)
She focused her testimony on three aspects of regulatory relief:
- Authorizing privately insured credit unions to become members of a Federal Home Loan Bank.
- The Consumer Financial Protection Bureau (CFPB) Rural Designation
- Petition and Correction Act.
- Directing federal financial regulators to address duplicative or inconsistent rules.
According to excerpts from Bartolomucci's testimony, released by CUNA, she advised the committee of the trade association's support of H.R. 3584, bi-partisan legislation introduced by Representatives Steve Stivers (R-Ohio) and Joyce Beatty (D-Ohio), which would allow state chartered, privately insured credit unions to apply for membership in the Federal Home Loan Bank System.
"It has never seemed fair to our small institutions that some of the largest banks in the world, or insurance companies (which are not federally insured), or a foreign bank's U.S. subsidiary can borrow billions of dollars from the Federal Home Loan Bank System, but teachers in Ohio and Texas, firefighters in California, postal and county workers in Illinois and farmers in Indiana cannot," she testified. "We think passing H.R. 3584 would be a just result to remedy this inequity."
Bartolomucci noted that privately insured credit unions do not engage in riskier activities than federally insured institutions, and argued there is no risk to the Federal Home Loan
Bank System from this legislation. "Will this change cause a significant number of credit unions to switch from federal to private insurance? No."
CFPB Rural Designation Petition And Correction Act
CUNA also supports H.R. 2672, a bill introduced by Rep. Andy Barr (R-Ky.) known as the CFPB Rural Designation Petition and Correction Act. Bartolomucci said this legislation would direct the CFPB to establish an application process determining whether a county should be designated as a rural area if the CFPB has not designated it as one.
"The concern CUNA has with the definition in the current rule is that many credit unions make loans to those in rural communities, but the credit union itself may not be based in those communities," she testified. "If the definition of 'rural' does not change, these institutions will be limited in the types of products they can offer their members in these areas."
Duplicative Or Inconsistent Rules
According to Bartolomucci, for those operating community based financial institutions, the crisis of "creeping complexity" with respect to regulatory burden is "very real."
"Small credit unions are expected to comply as quickly and efficiently as large financial institutions with hoards of compliance officers. While the elimination of one duplicative rule or regulation may not seem like much, to a compliance officer in a credit union, it is," she asserted. "Without one more rule to comply with that employee can now spend time with a credit union member, helping to serve their financial needs."
Bartolomucci's testimony on behalf of CUNA in front of the House Committee on Financial Services came one day after Linda Sweet, president and CEO of Big Valley FCU,
