WASHINGTON—Using the GAC as a platform to once again remind credit unions of NCUA’s commitment to providing regulatory relief for credit unions, Chairman Debbie Matz said the agency is dedicated to changing its culture to continue to ease the compliance burden.
Citing the “success” NCUA has had in “building a modern regulatory framework,” and with the financial crisis further back in the rear view mirror, Matz said a top priority became making it easier for credit unions to business.
“‘Easier to do business’ is not only about regulatory relief. It’s also about something even larger. It’s about the culture at NCUA,” Matz told attendees. “We needed to change our culture, to reset the default switch, to ‘yes.’”
Switching From ‘No’
Too often in the past, that default switch was set to ‘no,’ said Matz. “But that changed. You may remember when I stood on this stage last year, I committed to you that 2015 would be the Year of Regulatory Relief, and it was.”
Among the examples of that relief cited by Matz:
- Removal of the fixed assets limit
- Removal of member business lending limits not required by law
- Expansion of the definition of small credit unions
- Doubling the number of low-income CUs over the past four years, therefore exempting a large number of credit unions from the statutory member business lending cap
Matz noted that later this year the agency will modernize its field-of-membership rule for federal credit unions, and that NCUA recently signed an agreement with the U.S. Treasury that will give hundreds more credit unions access to the Community Development Financial Institutions Fund.
Looking Back, And Ahead
Matz reflected on her first days on the job as chairman, and how far the industry has come, working its way through the financial crisis.
“Back then, we were working around the clock to prevent the collapse of the credit union system. And while you might not know this, the outcome was really in doubt,” shared Matz. “During that pivotal summer of 2009, I asked NCUA staff to compile a list of credit unions rated CAMEL 4 and 5. When I saw the list, I couldn’t believe my eyes. Hundreds and hundreds of credit unions were teetering on the brink of failure – and 14 of those credit unions had assets over a billion dollars.
“So just like you worked hard to get your credit union through the crisis, at NCUA, we also worked nights and weekends,” continued Matz. “We put new safeguards, policies and procedures in place to stop the hemorrhaging and prevent the credit union system from failing. Ultimately, we succeeded.”
Ahead Of Curve
Matz reminded that for both credit unions and the agency, both must “stay ahead of the curve,” to keep the system strong.
“We all need to understand how technology is influencing the delivery of financial services, and how our nation’s demographics are changing,” Matz explained. “As CEOs, managers, and volunteers hoping to lead your credit union into the future, you will need to address these critical, forward-looking issues: making Millennials into members, keeping pace with evolving technology, and adopting strong cybersecurity. Those things will determine the future of your credit union.”
Re-emphasizing the importance of the commitment from credit unions and the agency to ensuring the CU system remains sound, Matz said she recently watched the movie The Big Short, which tells the story of meltdown in housing that led to the recession.
“It brought back haunting memories of what we lived through,” she said. “You and I can agree, we definitely don’t want a real-life sequel.”