CUNA News
  • LOG IN
  • Create Account
  • Sign Out
  • My Account
  • LOG IN
  • Create Account
  • Sign Out
  • My Account
  • Credit Union Magazine
    • Buyers' Guide
    • Digital Edition
    • Credit Union Hero
    • Credit Union Rock Star
    • Subscribe
    • Advertise
    • Contact
  • Advertise
  • Topics
    • Community Service
    • Compliance
    • Credit Union Hero
    • Credit Union Rock Star
    • Credit Union System
    • Directors
    • Human Resources
    • Leadership
    • Lending
    • Marketing
    • Operations
    • Policy & Issues
    • Sales & Service
    • Technology
  • Awards
    • Nominate Credit Union Hero
    • Nominate Credit Union Rock Star
  • Podcasts
  • Videos
  • Jobs
  • Contact

News

Home » CUNA to GAO: ‘No compelling reason’ to change CU regulatory structure
Policy & Issues

CUNA to GAO: ‘No compelling reason’ to change CU regulatory structure

April 28, 2023
The High Cost of Regulatory Burden

CUNA has serious reservations about the conclusion of a Government Accountability Office study relating to the regulation of federal depository institutions, it wrote to the GAO. The study, “High-Risk Series Efforts Made to Achieve Progress Need to Be Maintained and Expanded to Fully Address All Areas” (GAO-23-106203), contains several troublesome recommendations.

Page 68 of the report recommends Congress “consider whether additional changes to the financial regulatory structure are needed to reduce or better manage fragmentation and overlap,” in the oversight of financial institutions.

“Should they be enacted into law, the recommendations put forth in this report regarding the consolidation of federal financial regulatory bodies would result in the elimination of the independent National Credit Union Administration, as well as the National Credit Union Share Insurance Fund,” the letter reads. “This would be devastating to credit unions as it would almost certainly diminish the viability of the credit union charter.”

CUNA—as representative for the entities that fund NCUA—does not believe NCUA should be eliminated and its functions consolidated into a larger federal banking regulator.

“Maintaining a separate, independent federal credit union regulator and insurer is critically important to the credit union system, and the structural and mission-driven differences between credit unions and banks necessitate such a regulatory scheme: credit unions' not-for-profit structure and their mission to promote thrift and provide access to credit for provident purposes are fundamentally different than other financial services providers,” the letter reads. “Further, credit unions – not taxpayers – are called on to provide NCUA additional funds if the agency or the share insurance fund require additional funding.”

“There is no compelling reason to change that arrangement,” it adds.

CUNA notes that NCUA—and state financial regulators—provide “thorough oversight, examination, and supervision” of America’s credit unions, and NCUA is NCUA is unique because it is the only financial regulator that is both an insurer and primary functional regulator.

“To reflect this dual function, its overall funding is derived from both a transfer from the share insurance fund and operating fees charged to credit unions,” the letter reads. “NCUA is funded by credit unions and their members, not by taxpayers. Credit unions and their members remain willing to pay for their own regulator provided there is sufficient transparency with respect to the agency’s budget and the overhead transfer rate.

“Under its current leadership, NCUA has made great progress in bringing about greater budget and operational transparency,” it adds.

 

Credit Union Magazine: Summer 2023

Summer 2023

Credit Union Magazine’s Summer 2023 issue highlights the lending outlook for the rest of the year, how credit unions leverage fintech companies to boost digital lending, the power of lending partnerships, common Bank Secrecy Act violations, and the shift board members must make when becoming chair.
Digital Edition •  Subscribe

Trending

  • Debt ceiling deal has credit union implications

  • One week to nominate a 2023 Credit Union Rock Star

  • CUNA to host free webinar on FedNow service strategy June 13

Tweets by CUNA_News

Polls

Do you think ChatGPT will become useful for credit unions?

View Results
More

Champion for the Credit Union Movement

Credit Union National Association is the most influential financial services trade association and the only national association that advocates on behalf of all of America's credit unions. We work tirelessly to protect your best interests in Washington and all 50 states. We fuel your professional growth at every level and champion the credit union story at every turn.

More CUNA

  • Membership
  • Contact Us
  • Careers

Resources for

  • Credit Union Advocates
  • Leagues
  • Press
  • Providers

Our Affiliates

  • American Association of Credit Union Leagues (AACUL)
  • Credit Union Awareness
  • Credit Union House
  • CUNA Strategic Services
  • National Credit Union Foundation
GET CUNA UPDATES
© 2023 Credit Union National Association | ADA Compliance Notice & Legal
Email Us