Credit unions would only be further burdened should the NCUA gain supervision over third-party vendors, CUNA Chief Advocacy Officer Ryan Donovan said Wednesday. Donovan’s comments came in response to the Financial Stability Oversight Council’s (FSOC) annual report, which recommended giving NCUA that authority.
“Credit union vendors generally fall into two categories: vendors that also serve banks--and are therefore examined by banking regulators--and credit union service organizations owned by credit unions examined by NCUA,” Donovan said. “We believe that between the two, risks can be appropriately identified and addressed. Any additional authority would only serve to add cost and burden to credit unions.”
The 2015 FSOC Report included the same recommendation.
CUNA has raised numerous concerns about allowing the NCUA to have supervisory authority over third-party vendors. In addition to the increased regulatory burden, CUNA questions the agency’s expertise in this area, as well as implications for its budget, which has been increased for the last 7 years.
CUNA successfully fought to keep an amendment granting the NCUA vendor authority out of the Cybersecurity Information Sharing Act last year.