Cheney Urges Regulatory Relief

Nine ways to create a more positive regulatory environment for CUs.

February 10, 2011

Regulatory burdens are among the most significant problems facing credit unions today, and helping to contain these burdens is one of CUNA's highest priorities.

That was the message CUNA President/CEO Cheney imparted in a letter to NCUA Board Chairman Debbie Matz, which urged her to follow President Obama’s executive order regarding the need for regulatory relief.

Cheney cited nine actions that would create a more positive regulatory environment for credit unions:

1. Announce that pursuant to President Obama’s executive order, NCUA will review all of its regulations to mitigate their impact on federally chartered and federally insured credit unions wherever possible.

CUNA encouraged the agency to release, by early summer, prospective rules for streamlining regulations for well-run credit unions, while protecting safety and soundness.

2. Identify opportunities to simplify regulatory requirements for credit unions with less than $250 million in assets. CUNA's Small Credit Union Committee could be an important resource in this endeavor.

3. Work with the Consumer Financial Protection Bureau to limit the negative impact of its regulations on credit unions.

Subscribe to Credit Union Magazine4. Develop a web page linked to NCUA's home page that’s devoted to regulatory relief and the activities the agency is undertaking to review its rules and relieve unnecessary burdens.

5. Consider ways to expand the Regulatory Flexibility Program to provide additional incentives for well-managed credit unions.

6. Avoid over-regulating credit union volunteers.

7. Avoid regulating in order to eliminate risks presented by the current economic crisis as opposed to allowing credit unions to manage those risks, consistent with legal requirements and safety and soundness.

8. Help diffuse the tension that’s building within the credit union system regarding the examination process by adopting the recommendations contained in CUNA’s “Guidance for Credit Unions on Supervisory and Examination Issues.”

9. Consider whether additional cuts in the agency’s 2011 budget could be made in line with efforts in Congress and the Administration to contain or reduce their operating costs.

Cheney commended Chairman Matz for communicating her strong support of legislation to provide supplementary capital for credit unions and to facilitate their net-worth calculations.

“I appreciate your willingness to help ensure Congress is aware of NCUA’s views, particularly on supplementary capital,” he wrote.

Cheney said CUNA is reviewing the totality of credit unions’ regulatory burdens, as well as identifying specific regulations that are problematic.

“We will be working closely with leagues and credit unions to ensure we do not miss any rules that should be improved, and will be sharing our conclusions and recommendations with NCUA and other policymakers.”