NCUA Board Meeting Coverage: Plenty of ‘Feedback’ From Town Hall; CU Consolidation ‘Not a Friend’ to Agency

ALEXANDRIA, Va.–The first-ever Strategic Plan Town Hall meeting held last week by NCUA provided significant direction around what credit unions want to see change, according to the agency’s chairman, who also stressed NCUA does not want to see fewer credit unions in the U.S.

In opening remarks to the NCUA board meeting, Kyle Hauptman said significant feedback was provided on the challenges being faced by various communities within credit unions and how NCUA can “best support safety and soundness while encouraging innovation and growth.”

“We’ve gotten a lot of feedback on what’s working, what’s not working, and what the community writ large would like to see regarding regulation and deregulation and what issues they see as being important in the future,” said Hauptman.

He added that NCUA continues to receive feedback via its Ask NCUA tool. As the CU Daily reported here, that includes feedback from a group of small CUs that have formed a group called “Endangered Credit Union Defense” that provided a detailed list of a dozen changes they would like to see.

Learning About ‘Needs’

“This approach to strategic planning, which brings stakeholders into the conversation, is how I want to see NCUA approach its work,” said Hauptman. “By listening, by asking questions, we learn more about the needs of credit unions and how we can achieve our goal of safety and soundness while reducing the weight of burdensome and inefficient rules and regulations, especially for small and the midsize credit unions who often have very specific needs and challenges. Safety and soundness isn’t necessarily in conflict with rightsizing regulatory burden. In fact, if we rightsize in a thoughtful manner we’ll make it less likely that (the movement) winds up being dominated by a few large credit unions.”

‘Not a Friend’

While some in credit unions have suggested that NCUA would prefer to oversee fewer credit unions, Hauptman said during the board meeting, “Consolidation is not the friend of the regulator and it’s definitely not the friend of an insurer like NCAA.”

It’s better to have a diversified risk portfolio and a “wide plethora” of credit unions as “diverse in their business model as they are on their fields of membership,” he said.

“Our examiners shouldn’t be telling credit unions that ‘This isn’t something we see in most credit unions.’ That’s feedback I’ve gotten. That discourages a diverse set of business practices at America’s 4,400 credit unions,” Hauptman stated. 

He added that if “one thing was clear” following the feedback process it is the “outsized burden that obsolete, duplicative and overly prescriptive regs can have on credit unions.”

Noting the agency’s own workforce is down 20% due to White House-ordered staffing reductions, Hauptman said NCUA has an “an operational imperative to rightsize everything that we do.”

No Board Meeting in October

Hauptman, who remains the lone member of the NCUA board while Todd Harper and Tanya Otsuka, who were fired by President Trump, pursue their case in the courts, said NCUA will not host an October board meeting but will host its annual public budget meeting.

For The Record

For the sake of the record, Hauptman also noted that while he (and others) have stated that the last time NCUA had a one-member board was 2001 when Dennis Dollar was chairman, it was actually 2005, with then Chairman Joann Johnson presiding over the meeting.