ALBUQUERQUE, N.M. (3/29/16)--New Mexico residents learned about the effect the Dodd-Frank Act and its regulatory regime are having on the state’s credit unions in a Monday article in the Albuquerque Journal.
“How many more car loans, how many college educations could we use of that (nearly) $52 million to help average New Mexicans?” Paul Stull, president/CEO of the Credit Union Association of New Mexico, told the Albuquerque Journal.
Backed by numbers from the Credit Union National Association’s (CUNA) recently released regulatory burden study, Stull and Marsha Majors, president/CEO of Albuquerque’s U.S. Eagle FCU, detailed the cost to the state’s 46 credit unions and more than 805,000 members.
In 2014 alone, New Mexico credit unions realized $51.6 million in costs due to regulations and revenue reductions of $9.2 million. The CUNA study found a $7.2 billion financial impact on credit unions nationwide.
Majors said her credit union must direct more money to cover regulatory expenses--an increase of 35% in the past five years. This hampers the Albuquerque credit union’s commitment to provide better deposit and loan rates, meet members’ needs for loans and mortgages, and support small business growth.
“Our loan officers have to be up to speed” on all the rules, she told the Journal, adding the increased compliance for mortgage disclosures also have affected service.
“On the mortgage side, if you have the slightest errors, the clock starts all over,” she said.
The state’s three U.S. representatives were among the legislators who voiced their concerns in a letter to the Consumer Financial Protection Bureau, asking the agency to use its exemption authority to protect credit unions from the Dodd-Frank regulatory burden. New Mexico credit unions also have met with policymakers.
“The unfair advantage is the unintended consequences hurting New Mexican consumers, limiting the choice and availability of consumer credit,” Stull said.