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From the CEO: Majority of House supports credit union exemption from CFPB

From the CEO
March 18, 2016

Dear members:

We just got back from CUNA’s Governmental Affairs Conference (GAC) in Washington, D.C., which is the biggest advocacy event of the year for our industry. It brings together advocates on behalf of America’s credit unions and the industry’s 100 million-plus members. We were excited once again to exhibit Corporate One’s solutions for credit unions and hike Capitol Hill. We met face-to-face with senators and house representatives to highlight important credit union initiatives and to demonstrate the positive impact we make on our members' financial lives.

In sessions with members of Congress and the Consumer Financial Protection Bureau (CFPB) we learned how the CFPB’s current rule-making agenda (both past and present) is affecting credit unions’ abilities to serve their members. On the agenda was the unprecedented amount of regulations (and more that are proposed) impacting credit unions. Not only are these regulations oftentimes costly for credit unions and members alike, but they also may be major hindrances to serving members appropriately.

America’s Credit Unions

  • 102 million members in 6500 credit unions
  • 6.8% of all depository institution assets
  • Since 2008, credit unions have been subjected to more than 190 regulatory changes from at least 15 different federal agencies.
  • In 2014, the financial impact of regulation cost credit union members $7.2 billion. That’s $2.8 billion per year more than it cost them in 2010.

Source: CUNA Advocacy Briefing, February 2016

For example, the numerous regulations surrounding mortgage lending (HMDA, TILA/RESPA, appraisal rules, loan officer compensation rules, servicing rules, qualified mortgage/ability-to-repay rules, etc.) have brought greater compliance and legal risk to credit unions. More concerning, many of these well-intentioned rules are forcing credit unions to stop offering certain products and services, and in turn are limiting consumers’ options for credit.

Another topic of interest during Hike the Hill visits was current exam cycles for natural-person credit unions. We requested that our legislators send support letters to the chair of the National Credit Union Administration (NCUA), suggesting the NCUA extend its current exam cycle. And through the implementation of new technology by the NCUA, which would modernize its examination process, the frequency of exams should be reduced for credit unions (from a 12-month examination cycle to an 18-month cycle).

There are many other important issues and topics that credit union members discussed with legislators during the GAC, and I urge you to work with your state’s league to stay informed and be a proactive advocate for our industry. If you’d like to do more, you can start by going to CUNA’s Grassroots Action Center to contact your state legislator and send them a personal letter, or just contact your state credit union league for more tools.

Lee Butke