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Lawmakers Petition NCUA Chair for Regulatory Relief for Credit Unions

hands-writing1A bipartisan group of 30 members of the U.S. House of Representatives, led by Reps. Frank Guinta (R-New Hampshire) and Rubén Hinojosa (D-Texas) has signed a letter to National Credit Union Association (NCUA) Chairman Debbie Matz asking for the 18-month exam cycle to be extended to well-run credit unions.

In January, the FDIC approved an interim final rule that allows well-managed community banks and thrifts with less than $1 billion in assets to qualify for the 18-month on-site exam cycle. Previously, only financial institutions with less than $500 million were eligible for the 18-month exam cycle. The change affected more than 600 institutions, according to Comptroller of the Currency Thomas Curry.

With the interim rule change, credit unions are the only federally regulated depository institutions that still fall under the strict 12-month exam cycle at the federal level. National Associatoin of Federal Credit Unions (NAFCU) President and CEO Dan Berger wrote a letter to Matz last month asking NCUA to lengthen the exam cycle for credit unions from 12 months to 18 months.

On Thursday, Berger praised the efforts of the group of bipartisan lawmakers led by Guinta and Hinojosa.

“We appreciate the leadership shown by Representatives Guinta and Hinojosa, and their colleagues from both sides of the aisle, in urging NCUA to return to an 18-month exam cycle,” Berger said. “Credit unions have been widely recognized by lawmakers and regulators for their prudent business model and for not causing the financial crisis. Credit unions are in particularly solid shape as an industry and do not require the additional burden of more-frequent exams. Extending the exam cycle for well-run credit unions will also help NCUA better allocate resources to address those institutions requiring more oversight.”

The lawmakers, in their letter, noted that NCUA had made progress toward regulatory relief but stated there was more work to be done. In particular, they noted that Congress approved the 18-month exam cycle for banks last year and pointed out that such regulators as the OCC, FDIC, and Federal Reserve have begun to take steps toward an extended exam cycle for banks.

About Author: Brian Honea

Brian Honea's writing and editing career spans nearly two decades across many forms of media. He served as sports editor for two suburban newspaper chains in the DFW area and has freelanced for such publications as the Yahoo! Contributor Network, Dallas Home Improvement magazine, and the Dallas Morning News. He has written four non-fiction sports books, the latest of which, The Life of Coach Chuck Curtis, was published by the TCU Press in December 2014. A lifelong Texan, Brian received his master's degree from Amberton University in Garland.

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