CUNA provides roadmap for reduced regulatory burden
01/06/2011 10:52 am
The 112th Congress, which began on Wednesday, can help lessen the regulatory burden faced by credit unions by allowing credit unions to raise supplemental capital, reviewing and potentially amending the Federal Reserve's recent interchange fee proposal, and lifting the cap on credit union member business lending, the Credit Union National Association (CUNA) said in a Wednesday letter to Rep. Darrell Issa (R-Calif.)
Issa, pictured left, will chair the House Government Reform and Oversight Committee during the 112th Congress.
CUNA pinpointed a number of additional ways that Congress could help reduce the regulatory burden on credit unions. Congress could encourage the National Credit Union Administration (NCUA) and other regulators to reward well-run credit unions by lengthening their examination cycles to 18 months, streamlining their 5300 call reports, and providing them with automatic waivers from regulatory limitations that are not required by statute, CUNA said.
Further, the budgets and resource allocations of the agency and other federal financial regulators should also be subject to periodic congressional review, CUNA suggested. The Government Accountability Office could also monitor these agencies to review their compliance with the Paperwork Reduction and Regulatory Flexibility Acts, and could force regulators to report on whatever yearly steps they have taken to reduce the regulatory burden on their respective institutions, CUNA added.
"The only owners of a credit union are its members, who receive the benefit of ownership through reduced fees, lower interest rates on lending products and higher dividends on savings products," CUNA President/CEO Bill Cheney wrote.
"Because of this structure, the cost of a credit union's compliance with unnecessary and unduly burdensome regulation impacts its members more directly than bank customers. Every dollar that a credit union spends complying with regulation is a dollar that is not used to the benefit of the credit union's membership," Cheney added.
CUNA was responding to a specific request made by Issa in a Dec. 10 letter, in which he asked for about 150 companies, think tanks and trade groups to provide their input on various regulations.